At the end of the accounting year the balance in purchases returns account is closed by transferring to __________ account.

(a)

Capital

(b)

Purchases

(c)

Sales

(d)

None of these

___________ refers to buying and selling of goods with the intention of making profit.

(a)

Trading

(b)

Trial balance

(c)

Balance Sheet

(d)

Profit and Loss Account

____________ account is prepared to find out the difference between the revenue from sales and cost of goods sold.

(a)

Trading

(b)

Profit and Loss

(c)

Balance

(d)

Statement of affairs

_____________ refers to directly related cost.

(a)

Purchases

(b)

Sales

(c)

Cost of goods sold

(d)

Liabilities

If the amount of sales exceeds the cost of goods sold, the difference is ____________

(a)

Gross profit

(b)

Net profit

(c)

Gross loss

(d)

Net loss