Closing stock uder value 10000 and opening stock up by 1000,what is pr

1.	Closing stock uder value 10000 and opening stock up by 1000,what is profit ?
Answer» let us take an example to solve this question assume closing stock = 50000 opening stock = 30000 Then profit = closing stock - opening stock = 50000-30000 =20000 as per statement if closing stock undervalued by 10000 then EFFECT will be 50000-10000 = 40000 opening stock overvalued by 1000 then the effect will be 30000+1000= 31000 now new profit = closing stock - opening stock =40000-31000 =9000 therefore from our example its clearly known that profit has been REDUCED . so ,if Closing stock undervalued by 10000 and opening stock up by 1000, profit will be reduced by 11000(OLD profit - new profit ie, 20000-9000) Hope u UNDERSTOOD and useful..!!

Closing stock uder value 10000 and opening stock up by 1000,what is profit ?

Answer»

let us take an example to solve this question

assume

closing stock = 50000

opening stock = 30000

Then profit = closing stock - opening stock

= 50000-30000

=20000

as per statement if closing stock undervalued by 10000

then EFFECT will be

50000-10000 = 40000

opening stock overvalued by 1000

then the effect will be

30000+1000= 31000

now new profit = closing stock - opening stock

=40000-31000

=9000

therefore from our example its clearly known that profit has been REDUCED .

so ,if Closing stock undervalued by 10000 and opening stock up by 1000, profit will be reduced by 11000(OLD profit - new profit ie, 20000-9000)

Hope u UNDERSTOOD and useful..!!

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