A trader receives Rs. 260,000 in cash during the year. This includes Rs. 190,000 from debtors, Rs. 25,000 from the sale of equipment, and Rs. 15,000 as a loan. What are the cash sales?
Correct answer: C. Rs. 30,000
- A. Rs. 20,000
- B. Rs. 25,000
- C. Rs. 30,000
- D. Rs. 35,000
Explanation
Cash sales are found by deducting other identified receipts from total cash receipts. Thus, Rs. 260,000 minus Rs. 190,000, Rs. 25,000 and Rs. 15,000 equals Rs. 30,000.
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About Incomplete Records
Incomplete records require profit and financial position to be reconstructed when a complete double-entry system is unavailable. Methods include statements of affairs, capital comparisons, control accounts, cash summaries and margin calculations to find missing sales, purchases, expenses, assets, liabilities and drawings, while distinguishing business profit from changes in capital.
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