Question

Cash sales of a business in a year were ​Rs. 85,000, the Cost of Goods Sold (including direct expenses) was Rs.97,000 and Gross Profit as shown by the Trading Account for the year was Rs. 1,29,000. Calculate Credit Sales during the year.

Answer 1

Gross Profit = Net Sales – Cost of Goods Sold
1,29,000 = Net Sales – 97,000
Net Sales = Rs 2,26,000
Credit Sales = Total Net Sales – Cash Sales
Credit Sales = 2,26,000 – 85,000 = Rs 1,41,000