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Hi sir! Would you please answer my question?
P is a sole proprietor whose accounting records are incomplete. All the sales are cash sales and during the year $50,000 was banked, including $5,000 from the sale of a business car. He paid $12,000 wages in cash from the till and withdrew $2,000 per month as drawings. The cash in the till at the beginning and end of the year was $300 and $400 respectively.
What were the sales for the year?I don’t understand it why is the answer 81100, is not 86100?
5000 from the sale of a business car is not the sale?The sales figure in the SOPL is the total revenue from sales of whatever the business is trading in.
A car is a capital asset, and if they sell it then the profit or loss on sale is shown separately in the SOPL. It is not part of the sales figure.
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