Question

from the following information calculate capital at the beginning
capital at the end of year 40000
drawing made during the year 60000
fresh capital introduced during the year 100000
profit of the current year 80000

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Answer 1

Answer:

80000

Explanation:

closing capital+drawings - additional capital- opening capital=profit/loss

Answer 2

Answer:

80,000

Explanation:

Closing capital = Opening capital + Additional capital (+ Profit - Loss) - Drawings

Here,

Closing capital = 40,000

Drawings = 60,000

Additional capital = 1,00,000

Profit = 80,000

Substitute the values to the equation

Let the opening capital be 'x'

We get,

40,000 = x + 1,00,000 + 80,000 - 60,000

40,000 = x + 1,20,000

x = 1,20,000 - 40,000

x = 80,000