To ascertain the profit, closing capital is to be adjusted by deducting and adding _.

Opening capital, Drawings

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Opening capital, Cash deposit

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Surplus, Opening balance

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None of the Above

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Solution

The correct option is D Opening capital, Drawings
To ascertain the profit, closing capital is to be adjusted by deducting opening capital and adding drawings.

Below is the example:
Opening Capital Rs.30000
Drawings Rs.5000
Closing Capital Rs.50000

Solution:
Closing Capital Rs.50000
Add: Drawing Rs. 5000
----------------
Rs.55000
Less: Opening Capital Rs.30000
---------------
Profit during the year Rs.25000
-----------------

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Similar questions

Explain how the following may be ascertained from incomplete records

(a) Opening capital and closing capital

(b) Credit sales and credit purchases

(d) Closing balance of cash

Explain how the following may be ascertained from incomplete records:

(a) Opening capital and closing capital

(b) Credit sales and credit purchases

(d) Closing balance of cash.

If opening capital is less than closing capital, it shows:

(a) Loss

(b) Profit

(d) Profit, if no additional capital is introduced.

Closing capital= Rs. 2,00,000, Profit = Rs. 50,000, Drawings = Rs. 5,000, what will be the opening capital ?

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