Question

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3. Retro Ltd. was formed by taking over the existing business of Zed Bros, with effect from
01.04.2016. But the company was incorporated on 01.07.2016, No entries were made
relating to transfer till 31.03.2017. On that day, the following balances were found to
determine the net profit:
Gross Profit 96,000; Carriage Outwards - 3,200, Travellers' Commission-28,000;
Office Expenses - 9,000; Rent and Rates 18,000; Directors' fees - 37,000; Deprecia-
tion on Fixed Assets- 15,000; Debenture Interest * 5,600; Audit fees- 2,400; Partners'
remuneration-6,000; Share transfer fees received 1,000; Other Information:
(i) GP ratio was constant per month.
(ii) Monthly sales in May, June, September and December were double the average
monthly sales for the remaining months.
Show the pre and post incorporation profit​

Answer 1

Step-by-step explanation:

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