Holidays Ltd manufactures caravans.Transactions for the year ended 30 June 2016 were as follows:
- What was the reported profit for the year ended 30 June 2016 if revenue was recognised when cash was received?
A) $5 000 000
B) $6 000 000
C) $24 000 000
D) $4 000 000

Question

Holidays Ltd manufactures caravans.Transactions for the year ended 30 June 2016 were as follows: 
-  What was the reported profit for the year ended 30 June 2016 if revenue was recognised when cash was received?
A) $5 000 000 
B) $6 000 000 
C) $24 000 000 
D) $4 000 000

Quizplus · Accepted Answer

The reported profit for the year ended 30 June 2016 if revenue was recognised when cash was received can be calculated as follows:
Total revenue = $24,000,000 + $600,000 = $24,600,000
Total expenses = $19,600,000
Profit = Total revenue - Total expenses = $24,600,000 - $19,600,000 = $4,000,000.
Therefore, the answer is D.

Holidays Ltd Manufactures Caravans