alleryTrial balance shows opening stock ₹50,000, purchases ₹2,00,000, sales ₹3,50,000. Closing stock ₹70,000. Gross profit:
A₹1,50,000 gross profit
B₹1,70,000 gross profit
C₹1,20,000 gross profit
D₹1,80,000 gross profit
Answer & Solution
Correct answer: B. ₹1,70,000 gross profit
1. COGS = 50,000 + 2,00,000 − 70,000 = 1,80,000.
2. Gross profit = 3,50,000 − 1,80,000 = ₹1,70,000.
_Source: ICAI BoS Foundation Paper 1, Ch 7 U1 "Final Accounts", §1.3 example_
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