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Question

Sales are equal to__________.
  1. Purchases + Gross Profit
  2. Cost of goods sold + Gross Profit
  3. Purchases + Cash in hand
  4. Cost of goods sold + Net Profit

A
Cost of goods sold + Gross Profit
B
Cost of goods sold + Net Profit
C
Purchases + Gross Profit
D
Purchases + Cash in hand
Solution
Verified by Toppr

Accounting Equation can be represented as:

Cost of Goods Sold=Opening Stock+Purchases+Direct Expenses-Closing Stock

Sales= Cost of Goods Sold + Gross Profit

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