Accounting Multiple Choice Question – 9 March 2022

Alex’s business has extracted the following information from its books of account at 31 December 2021, which is its first year of trading.

• carriage inwards – £12k
• carriage outwards – £15k
• closing inventory – £86k
• purchases – £286k
• returns inwards – £5k
• returns outwards – £2k
• revenue – £524k

What is the gross profit for the year ended 31 December 2021?

Select ONE answer:

1. £301,000
2. £309,000
3. £320,000
4. £328,000

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Not correct
2. Correct ==> (£524k – £5k) – (£0 + £286k – £2k – £86k + £12k)
3. Not correct
4. Not correct

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