Question
Lee opened his new business on 1 January 2016. On that date, the only asset was a bank balance of $10,000. During the year, Lee’d drawings from the business totalled $35,000. On 31 December 2016, the assets and liabilities of the business were as follows: · Computers and furniture $60,000, · inventory of raw materials $16,500, · finished goods, at cost $7,400, · bank overdraft $11,600, · trade payables, $5,500, · prepayments $1,500, · trade receivables $4,500, · the provision for bad debts $2,000, · bank loan $39,000, · interest payable $500, · accrued expenses, $2,600. What is the profit of the business in the year ended 31 December 2016?
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