Reference no: EM133004599

Question - Lee opened his new business on 1st January 2016. On that date, the only asset was a bank balance of $10,000. During the year, Lee'd drawings from the business totaled $35,000. On 31 December 2016, the assets and liabilities of the business were as follows: Computers and furniture $60,000, inventory of raw materials $16,500, finished goods, at cost $7,400, bank overdraft $11,600, trade payables, $5,500, prepayments $1,500, trade receivables $4,500, the provision for bad debts $2,000, bank loan $39,000, interest payable $500, accrued expenses, $2,600.

What is the profit of the business in the year ended 31 December 2016?

a. $63,700

b. $123,700

c. $62,700

d. $53,700