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Multiple choice

Goods costing Rs. 10, 000 destroyed by fire were not recorded. The error will result in

  1. increase in gross profit

  2. decrease in gross profit

  3. no effect on gross profit

  4. either (1) or (2)

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

 Goods destroyed not recorded will decrease the stock,  which ultimately will decrease the Gross Profit.

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