Question

The gross profit is transferred to ________ account. (Fill in the blank by choosing correct option)
a) trading
b) profit and loss
c) capital
d) current

Answer 1

Explanation:

ANSWER b) profit and loss.

Answer 2

The gross profit is transferred to the profit and loss account.

* This account reflects the expenses and revenues of a firm during a given period of time.

* The net profit or loss can be calculated from here as:

If the debited amount is smaller----> net profit

If the debited amount is bigger------> net loss.