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WAEC Commerce 2000 Question 8

Question 8

Business Calculations

Use the following equation: Gross Profit = (Closing stock + P) less (Opening stock + G).
What is G in the above equation?

  1. A.Sales returns
  2. B.Carriage inwards
  3. C.Purchases
  4. D.Sales
Show the answer and explanation

Answer: C (Purchases)

Explanation

Gross profit = (closing stock + sales) − (opening stock + purchases), so G is purchases.