Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Cash Flow Statement

Question:

While calculating operating profit which will be added to net profit?

Options:

Preliminary Expenses Written off

Depreciation

Loss on Sale of Asset

All of the Above

Correct Answer:

All of the Above

Explanation:

When calculating operating profit, all of the mentioned items – Preliminary Expenses Written off, Depreciation, and Loss on Sale of Asset – are typically added to the net profit. These items are considered non-operating expenses, and adding them back to the net profit helps arrive at the operating profit figure, which represents the profit generated from the core operating activities of the business.