LPR Is a Company That Commenced Business on 1 January

question 27

Multiple Choice

LPR is a company that commenced business on 1 January 2019. Below are the balances in the 30 June 2019 financial statements. What is the net profit for the period ending 30 June 2019?

• A) $15 000
• B) $25 000
• C) $40 000
• D) None of the above

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Definitions:

Operating Cash Inflow

Funds that are generated from a company's normal business operations, reflecting the cash inflows from selling goods and services.

Working Capital

The difference between a company's current assets and its current liabilities, indicating the liquid assets available for day-to-day operations.

Straight-Line Depreciation

A way of allocating an asset's expenditure smoothly over its effective life.

After-Tax Discount Rate

The interest rate used in discounting cash flows that takes into account the tax implications of the investment.