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JAMB Principles of Accounts 2011 Question 24

Question 24

Incomplete Records

Incomplete Record (Extract)
Sales ₦10 600
Rent ₦200
Depreciation of vehicle (cost N5000) 10%
Gross profit margin is 20%
Calculate the net profit.

  1. A.₦1 620
  2. B.₦1 920
  3. C.₦1 420
  4. D.₦2 120
Show the answer and explanation

Answer: C (₦1 420)

Explanation

Net profit = 2 120 − rent 200 − depreciation (10% × 5 000 = 500) = ₦1 420.