**Net profit is calculated in which of the following account?**

Net profit is calculated in the **Profit and Loss Account**.

**Explanation:**

The Profit and Loss Account, also known as the Income Statement, is a financial statement that summarizes the revenues, costs, and expenses incurred during a specific period. It is prepared by businesses to determine their net profit or net loss for a particular accounting period.

Here is a detailed explanation of why net profit is calculated in the Profit and Loss Account:

**1. Purpose of Profit and Loss Account:**
The main objective of the Profit and Loss Account is to determine the profitability of a business entity. It provides crucial information about the revenues generated and the expenses incurred during a specific period, allowing businesses to assess their financial performance.

**2. Revenues and Expenses:**
The Profit and Loss Account includes all the revenues (income) and expenses of a business. Revenues can come from various sources such as sales, services rendered, interest earned, etc. Expenses include the costs of goods sold, salaries, rent, utilities, taxes, depreciation, and other operating expenses.

**3. Calculation of Net Profit:**
Net profit is the final figure calculated in the Profit and Loss Account. It represents the excess of total revenues over total expenses during the accounting period. Net profit is an essential metric as it reflects the actual profitability of a business after considering all income and expenses.

**4. Format of Profit and Loss Account:**
The Profit and Loss Account is typically divided into two sections: the revenue section and the expense section. The revenue section lists all the incomes earned by the business, while the expense section shows the various expenses incurred. The difference between the total revenue and total expenses represents the net profit or net loss.

**Conclusion:**
In conclusion, net profit is calculated in the Profit and Loss Account. This account summarizes the revenues and expenses of a business for a specific accounting period and provides valuable information about the profitability of the business. It is crucial for businesses to regularly prepare and analyze their Profit and Loss Account to assess their financial performance and make informed decisions.