PRC-1 · Chapter 10 · Question 7 of 100
A business has a net profit before adjustments of Rs. 158,000. Adjustments are required for a prepaid expense of Rs. 11,200 and an accrued income of Rs. 16,800. What is the net profit after adjustments?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Rs. 186,000
Explanation
Prepaid expense reduces current year expenses (adds 11,200 to profit). Accrued income increases current year income (adds 16,800 to profit). Adjusted profit = 158,000 + 11,200 + 16,800 = Rs. 186,000.
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