How much profit did GCC make

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Problem - Gretta Cat Co. (GCC) has assets at January 1, 20X4, which consist of $8,000 in inventory. It did not have any liabilities at that date. During the year ended December 31, 20X4, GCC sold the inventory for $10,000 cash and distributed $1,000 to the owners by way of dividends. GCC replaced the inventory on December 31, 20X4, at a cost of $8,300. It did not have any other transactions during the year. The inflation rate during 20X4 was 5%. How much profit did GCC make according to the physical (productive capacity) concept of capital maintenance?

Reference no: EM132766985

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