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Mr. James has a Computer Peripherals business. In the beginning capital was £73,000. At the end of the year capital is £94,000. During the year Mr. James withdrawals were £86,000. Calculate the amount of net income or net loss for the period was :
A) Profit of £65,000
B) Loss of £21,000
C) Loss of £13,000
D) Profit of £1,07,000
Mr james has made the profit of107000 .
Net Income =1,007,000 (86000 withdrawals &21000 difference between Big & End )
94,000 +86,000-73,000 = A Net income of107,000 £
D) Profit of £1,07,000 (94000)
asnswer is net income/ profit107000
D-
Net Income107000
the formula for calculating the ending capital is as follows
Ending capital = beginning capital + net income - withdrawal
therefore, from the above formula we can drive that the formula to calculate the net income is
net income = ending capital + withdrawal - beginning capital
=94000 +86000 -73000 =107000
Therefore, choice D is the answer
correct answer is D-107000
Current capital = 94,000
Less capital in the beginning =73,000
Total = 21,000
Add Total withdrawals = 86,000
Grand total Net Income = 107,000
Answer is option D, that is he makes a profit of $107,000
