Test Index

WAEC Accounting 2018 Paper

Question : 33

Total: 50

Use the following information to answer the question below

Solution:

Concept:

Opening capital is derived from closing capital by adjusting for net profit, additional capital, and drawings.

Explanation:

The accounting relationship for capital is:

\text{Closing capital} = \text{Opening capital} + \text{Net profit} + \text{Additional capital} - \text{Drawings}

Rearranging this formula gives:

\text{Opening capital} = \text{Closing capital} + \text{Drawings} - \text{Additional capital} - \text{Net profit}

Substitute the given figures:

\text{Opening capital} = 650,000 + 30,000 - 100,000 - 250,000

\text{Opening capital} = 330,000

Therefore, the correct option is D.

Answer:

D. 330,000

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