Question

Closing capital = Rs. 1,20,000. Shares issued during the year Rs. 45,000. Drawings = Rs. 10,000. Profit for the year = Rs. 30,000 . What shall be the opening capital?

• A. Rs. 90,000
• B. Rs. 55,000
• C. Rs. 65,000
• D. Rs. 1,00,000

Answer 1

The correct option is B

Rs. 55,000

Opening capital
= Closing capital - Shares issued + Drawings - Profit
= Rs. 1,20,000 - Rs. 45,000 + Rs. 10,000 - Rs. 30,000
= Rs. 55,000.