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Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?
- a)1,02,000
- b)82,000
- c)1,77,000
- d)1,57,000
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
Mr. A started business with a capital of Rs.10 lakhs as a cloth mercha...
To calculate the gross profit, we need to subtract the cost of goods sold from the sales revenue.
Given information:
- Capital: Rs. 10 lakhs
- Purchases: Rs. 7,10,000
- Sales: Rs. 8,42,000
- Shop rent: Rs. 20,000
- Other expenses: Rs. 75,000
- Closing stock: Rs. 45,000
Let's calculate the cost of goods sold (COGS) using the formula:
COGS = Opening Stock + Purchases - Closing Stock
We are not given the opening stock in the question, so we cannot calculate the exact COGS. However, we can use the available information to estimate the COGS.
Estimating the COGS:
- Assuming the opening stock is zero, the COGS would be:
COGS = 0 + 7,10,000 - 45,000 = Rs. 6,65,000
Now, let's calculate the gross profit:
Gross Profit = Sales - COGS
Gross Profit = 8,42,000 - 6,65,000 = Rs. 1,77,000
Therefore, the gross profit is Rs. 1,77,000.
The correct answer is option C) 1,77,000.
Given information:
- Capital: Rs. 10 lakhs
- Purchases: Rs. 7,10,000
- Sales: Rs. 8,42,000
- Shop rent: Rs. 20,000
- Other expenses: Rs. 75,000
- Closing stock: Rs. 45,000
Let's calculate the cost of goods sold (COGS) using the formula:
COGS = Opening Stock + Purchases - Closing Stock
We are not given the opening stock in the question, so we cannot calculate the exact COGS. However, we can use the available information to estimate the COGS.
Estimating the COGS:
- Assuming the opening stock is zero, the COGS would be:
COGS = 0 + 7,10,000 - 45,000 = Rs. 6,65,000
Now, let's calculate the gross profit:
Gross Profit = Sales - COGS
Gross Profit = 8,42,000 - 6,65,000 = Rs. 1,77,000
Therefore, the gross profit is Rs. 1,77,000.
The correct answer is option C) 1,77,000.
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Mr. A started business with a capital of Rs.10 lakhs as a cloth mercha...
8,42,000+45,000-7,10,000=1,77,000.
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Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer?
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Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer?.
Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer?.
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Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer?, a detailed solution for Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer? has been provided alongside types of Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Mr. A started business with a capital of Rs.10 lakhs as a cloth merchant. During the year he purchased goods worth Rs.7,10,000 and sales during the year was Rs.8,42,000. He pays shop rent of Rs.20,000 for the year 2011-12, and other expenses Rs.75,000. Closing stock at the end of the year is Rs.45,000. What is gross profit?a)1,02,000b)82,000c)1,77,000d)1,57,000Correct answer is option 'C'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
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