Question
What is meant by Operating Profit?
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Answer
Operating Profit: Operating Profit is the profit earned through normal operating activities of the business. It is arrived at by deducting the operating expenses from gross profit. Expenses which are related to the main or normal activities of the business are called operating expenses. They include office and administrative expenses and selling and distribution expenses, discount, bad-debts etc. Operating Profit is also called 'Earning. Before Interest & Tax or EBIT'.
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Similar questions
Enter the following transactions in the Sales Return Book of Raj Computers, Delhi:
Write up the Ledger Accounts.
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2018
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July 1
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Sohan & Sons returned 2 Laptops HP sold @ ₹ 40,000 each plus CGST and SGST @ 6% each
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July 2
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Ramesh 2 'Ricoh' printers sold @ ₹ 10,000 each plus IGST @ 12%
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July 25
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Dinesh, Chandigarh returned 10 HP Desktops sold @ ₹ 20,000 each plus IGST @ 12% for delayed supply
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July 26
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Computer Mouse returned by Ravi, Delhi sold to him for cash ₹ 2,000 plus CGST and SGST @ 6% each
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Calculate the value of Opening Stock from the following:
“Single Entry System of book keeping is most incomplete, inaccurate, unscientific and unsystematic.” Discuss this statement.
Calculate operating profit from the following:
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₹
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Net Profit
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5,00,000
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Dividend Received
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6,000
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Loss on sale of Furniture
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12,000
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Loss by Fire
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50,000
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Salaries
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1,20,000
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Interest on Loan from Bank
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10,000
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Rent Received
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24,000
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Donation
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5,100
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Total of the Sales Book is posted to the credit side of the Sales Account in the General Ledger while individual account of customers is debited by the amount of their respective purchases. Is the above statement correct? Give reasons.
What do you mean by posting?
The following information is given.
Calculate credit purchases during the year.
| ₹ | |
| Opening creditors | 60,000 |
| Cash paid to creditors | 30,000 |
| Closing creditors | 36,000 |
| Returns Inward | 13,000 |
| Bill matured | 27,000 |
| Bill dishonoured | 8000 |
| Purchases return | 12000 |
| Discount allowed | 5,000 |
Why the statement of assets and liabilities prepared under Single Entry System at the end of the accounting period is called a Statement of Affairs instead of Balance Sheet?
Calculate the amount of bills receivable dishonoured from the following information.
| ₹ | |
| Opening debtors. | 45,000 |
| Closing debtors. | 56,000 |
| Discount allowed. | 2,500 |
| Sales returns. | 8,500 |
| Irrecoverable amount. | 4,000 |
| Bills receivables received. | 12,000 |
| Bills receivable dishonoured. | 3,000 |
| Cheque dishonoured. | 7,700 |
| Cash sales. | 80,000 |
| Cash received from debtors. | 2,30,000 |
| Cheque received from debtors. | 25,000 |
The Trial Balance of a retail trader on $31^{st}$ March, $2019$, includes the following selected account:
The closing stock on $31^{st}$March, $2019,$ is valued at ₹ $30,500.$
You are required to complete the missing values.
→The closing stock on $31^{st}$March, $2019,$ is valued at ₹ $30,500.$
You are required to complete the missing values.