Accounting 9706 · AS & A Level · The accounting system

The accounting system — practice question

At the beginning of the year, a sole trader’s capital account showed a balance of $183000. The following events occurred during the year. 1. The owner brought a motor vehicle into the business. Its cost was $90000 and its market value was $74000. 2. The owner withdrew cash drawings of $15000. 3. The owner removed inventory for personal use. This had a cost of $24000 and a selling price of $32000. Once these items and the profit for the year had been recorded, the closing balance on the capital account was $265000. What was the profit for the year?

  • A$31000
  • B$39000
  • C$47000
  • D$55000

Worked solution & mark scheme

This 1-mark question has a full step-by-step worked solution and mark scheme.

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI