double entry

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November 25, 2020 at 6:04 am #596355
beticopper
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is it true that when we purchase goods for resale capital decreases because purchases increases and profit decreases?
November 25, 2020 at 8:56 am #596380
John Moffat
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No.

At the end of the period when the profit is calculated the goods will either have been sold (and so profit will increase unless they were sold at a loss), or they will still be in inventory in which case the profit is not affected.
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