- June 15, 2021 at 2:58 am #625300KUMAR2810Participant
- Topics: 17
- Replies: 2
Sasha has prepared a draft statement of profit or loss for her business as follows:
Cost of sales
Opening inventory 13,400
Closing inventory (14,200 (144,200)
Gross profit 112,600
Net profit 36,600
Sasha has not yet recorded the following items:
? Carriage in of $2,300
? Discounts received of $3,900
? Carriage out of $1,950
After these amounts are recorded, what are the revised values for gross and net profit of
HOW IS DISCOUNT RECEIVED TREATED?
in the study text it said discount received should be netted off against purchase to reduce COS but in the solution of this question they not reduced from the COS instead they have subtracted from after the gross profit part so how should you account for discount received should be subtracted from cos or after the gp?June 15, 2021 at 8:21 am #625311John MoffatKeymaster
- Topics: 56
- Replies: 51576
It should be added after the calculation of the gross profit (here, as a reduction of the expenses figure).
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