Home
/
Business
/
The following information relates to the activities of Inga Candels for the year ended 31 Oct 2022: & multicolumn(1)(|c|)( £ ) Gross profit & 15,000 Motor vehicle expense & 2,000 Rent expense & 4,000 Light and Heat & 1,000 Salaries & 3,000 Interest on loan & 1,000 What is the entity's operating profit for the period? E3,000 E5,000 E10,000 E4,000 E6,000 E8,000 E2,000

Question

The following information relates to the activities of Inga Candels for the year ended 31 Oct 2022:

 & multicolumn(1)(|c|)( £ ) 
 Gross profit & 15,000 
 
Motor vehicle 
expense
 & 2,000 
 Rent expense & 4,000 
 Light and Heat & 1,000 
 Salaries & 3,000 
 Interest on loan & 1,000 


What is the entity's operating profit for the period?
E3,000
E5,000
E10,000
E4,000
E6,000
E8,000
E2,000

The following information relates to the activities of Inga Candels for the year ended 31 Oct 2022: & multicolumn(1)(|c|)( £ ) Gross profit & 15,000 Motor vehicle expense & 2,000 Rent expense & 4,000 Light and Heat & 1,000 Salaries & 3,000 Interest on loan & 1,000 What is the entity's operating profit for the period? E3,000 E5,000 E10,000 E4,000 E6,000 E8,000 E2,000

expert verifiedVerification of experts

Answer

4.2296 Voting
avatar
MiaVeteran · Tutor for 11 years

Answer

£4,000

Explain

## Step1: <br />Operating Profit is calculated by subtracting all operational expenses from gross profit. <br /><br />### The formula is: <br />**\[<br />Operating \ Profit = Gross \ Profit \ − \ (Motor \ Vehicle \ Expense + Rent \ Expense + Light \ and \ Heat \ Expense + Salaries + Interest \ on \ Loan)<br />\]**<br /><br />## Step2: <br />Plug in the given figures into formula:<br /><br />- Gross Profit = £15,000 <br />- Motor Vehicle Expense = £2,000 <br />- Rent Expense = £4,000<br />- Light and Heat Expense = £1,000<br />- Salaries = £3,000<br />- Interest on Loan = £1,000.<br /><br />## Step3: <br />Calculate Operating Profit, <br /><br />**\[<br />Operating \ Profit = £15,000 - ( £2,000 + £4,000 + £1,000 + £3,000 + £1,000 ) = £4,000<br />\]**
Click to rate:

Hot Questions

More x