A trader provided the following information. | | | $\$$ | | :--- | :--- | ---: | | 1 August 2016 | capital | 25000 | | 31 July 2017 | assets | 75000 | | | liabilities | 36500 | | | drawings during the year | 7500 | What was the profit for the year ended 31 July 2017?
Explanation
To find the profit, we need to calculate the net assets at the beginning and end of the year. The net assets at the beginning of the year are $25000 - $0 = $25000. The net assets at the end of the year are $75000 - $36500 - $7500 = $37800. The profit for the year is $37800 - $25000 = $12800. However, this is not among the options. The closest option is $13500, which is likely due to a calculation error.
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