Cost of Revenue from Operations =
Answer & explanation
Correct answer: option 2
Cost of Revenue from Operation= Purchases + (Opening Inventory – Closing Inventory) + Direct Expenses
= Purchases + Decrease in inventory + Direct Expenses
Net Purchases = Cash Purchases + Credit Purchases – Return Outwards
or alternatively
Cost of Revenue from Operation =Revenue from Operations – Gross Profit
= Purchases + Decrease in inventory + Direct Expenses
Net Purchases = Cash Purchases + Credit Purchases – Return Outwards
or alternatively
Cost of Revenue from Operation =Revenue from Operations – Gross Profit