Prepare the Statement of Profit or Loss for Ekerele Enterprises for the year ended 31st December 2019, using the provided balances and additional information.

To prepare the Statement of Profit or Loss for Ekerele Enterprises for the year ended 31st December 2019, we will use the provided balances and additional information.

Step 1: Calculate Net Sales
Net Sales is calculated by deducting Returns Inwards from Sales.

$$\text{Sales} = \text{₦}243,120$$ $$\text{Returns Inwards} = \text{₦}6,860$$ $$\text{Net Sales} = \text{₦}243,120 - \text{₦}6,860 = \text{₦}236,260$$

Step 2: Calculate Cost of Goods Sold (COGS)
COGS includes opening inventory, purchases, direct costs related to purchases, and direct wages, less returns outwards and closing inventory.

$$\text{Opening Inventory (31st Dec 2018)} = \text{₦}8,396$$ $$\text{Purchases} = \text{₦}152,408$$ $$\text{Carriage on Purchases} = \text{₦}23,912$$ $$\text{Direct Wages} = \text{₦}14,468$$ $$\text{Returns Outwards} = \text{₦}8,460$$ $$\text{Closing Inventory (31st Dec 2019, from additional info (a))} = \text{₦}102,800$$ $$\text{Cost of Goods Available for Sale} = \text{₦}8,396 + \text{₦}152,408 + \text{₦}23,912 + \text{₦}14,468 - \text{₦}8,460 = \text{₦}190,724$$ $$\text{Cost of Goods Sold} = \text{₦}190,724 - \text{₦}102,800 = \text{₦}87,924$$

Step 3: Calculate Gross Profit
Gross Profit is Net Sales minus Cost of Goods Sold.

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