Question

prepare Profit & Loss A/c of Ramesh for the year ending 31st March 2020.
₹
Gross Profit
1,30,000
Salaries
45,000
Rent & taxes
3,000
Insurance
1,000
Rent received
1,500​

Answer 1

expense

1. to salary ₹ 45000

2 . rent and taxes ₹ 3000

3. insurance ₹ 1000

income

1.gross profit ₹ 130000

2.rent received ₹ 1500

total income: 131500

so net profit is 82500

Answer 2

Answer: Net Profit transferred to capital is ₹82500

Explanation:

Profit & Loss A/c:
A profit and loss statement (P&L), also known as the 'Income Statement,' is a financial report that provides an overview of a company's revenues, expenses, and profits/losses for a period of time. It depicts a company's ability to generate sales, manage expenses, and generate profits over a period of time.

Given:

Gross Profit= ₹130000
Salaries= ₹45000
Rent & Taxes= ₹3000
Insurance= ₹1000
Rent received= ₹1500

Now, Net profit can be calculated by using the given information.

Net Profit= (Gross Profit+ Rent received)- (Salaries+ Rent & Taxes+ Insurance)
= (130000+1500)-(45000+3000+1000)
= 131500-49000
= ₹82500

∴ Net profit for the year ending 31st March 2020 for Ramesh will be ₹82500

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