Question 28
Departmental AccountsUse the information below to answer questions 27 and 28.
Departmental Trading Account (Extract) (shown in the figure).
Goods worth N 300 was transferred from department Q to P. Similarly, P's total expenses for the period was ₦200.
Department P's net profit was
- A.₦2 500
- B.₦2 800
- C.₦3 000
- D.₦5 200
Show the answer and explanation
Answer: A (₦2 500)
Explanation
P's cost of sales = 2,000 + 2,500 + 300 transferred in − 1,500 = ₦3,300. Gross profit = 6,000 − 3,300 = ₦2,700; net profit = 2,700 − 200 = ₦2,500.