The increase in net assets is $692, drawings are $308 and capital introduced is $180.
What is the net profit for the year?
Answer
Ending capital = beginning capital + profit +additional capital – drawing
Profit = drawing + ending capital – beginning capital – additional capital
Increase in net asset = ending capital – beginning capital
Profit = Drawings + Increase in net assets – Capital introduced
= $308 + $692 – $180
= $820