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WAEC Financial Accounting 2014 Question 45

Question 45

Final Accounts of a Sole Trader

Which of the following items is not treated in the Profit and Loss Account?

  1. A.Office expenses
  2. B.Salaries and allowances
  3. C.Carriage inwards
  4. D.Discounts allowed.
Show the answer and explanation

Answer: C (Carriage inwards)

Explanation

Carriage inwards is added to the cost of purchases in the trading account, not the profit and loss account.