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Mr. John is a dealer of stationer During the Year 2019-20 he purchased ball pens of Rs.20000 andnotebooks of Rs.30000 from the sup lier and paid 60% of the amount immediately and promised to paybalance amount later on. He also pu chased pencils of Rs.7500 and erasers of Rs.2500 from another supplierand paid the amount in cash.During the year he had total sales o Rs. 85000 out of which Rs.25000 is outstanding. Calculate his netincome on Cash and Accrual Basis,(1) What will be the net income on a sh Basis?(i) What will be the net income on A crual Basis? |
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Answer» Let the AMOUNT taxable purchase is x Rs. Then 6% of x= 100 30 100 6 ×x= 100 30 x= 6×100 30×100 =5 ∴cost of TAX FREE item=[25−(5+.30)] =25−5.30=19.70 |
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