To determine the profit for the year, we need to analyze the financial position of the business at the end of the year. We will follow a step-by-step approach to calculate the profit. Step 1: Understand the Components

1. Initial Capital: The proprietor started the business with #13,000.
2. Assets at Year-End:
3. Fixed Assets: #8,800
4. Stock: #600
5. Debtors: #1,000
6. Cash: #3,000
7. Liabilities at Year-End:
8. Creditors: #1,000

Step 2: Calculate Total Assets and Total Liabilities Total Assets can be calculated by adding all the assets together: - Total Assets = Fixed Assets + Stock + Debtors + Cash - Total Assets = #8,800 + #600 + #1,000 + #3,000 - Total Assets = #13,400 Total Liabilities is simply the total of the creditors: - Total Liabilities = #1,000 Step 3: Calculate Owner's Equity at Year-End Owner's Equity (or Capital) at the end of the year can be calculated using the accounting equation: [ \text{Owner's Equity} = \text{Total Assets} - \text{Total Liabilities} ] Substituting the values we calculated: - Owner's Equity = #13,400 - #1,000 - Owner's Equity = #12,400 Step 4: Calculate Profit for the Year To find the profit for the year, we need to compare the Owner's Equity at the end of the year with the initial capital invested by the proprietor. Profit can be calculated as: [ \text{Profit} = \text{Owner's Equity at Year-End} - \text{Initial Capital} ] - Profit = #12,400 - #13,000 - Profit = -#600 However, this indicates a loss, not a profit. Therefore, we need to re-evaluate the question and the options provided. Step 5: Re-evaluate the Options The options provided are: A. #2,400 B. #3,000 C. #9,800 D. #1,400 None of these options match our calculated loss of #600. Step 6: Correct Calculation of Profit To find the profit correctly, we should also consider the changes in the assets and liabilities. The profit can also be derived from the changes in the capital structure.

1. Initial Capital: #13,000
2. Ending Capital: #12,400 (as calculated)
3. Profit or Loss:
4. If the ending capital is less than the initial capital, it indicates a loss.
5. If the ending capital is more than the initial capital, it indicates a profit.

Conclusion After reviewing the calculations, it appears that the correct answer is not among the options provided. The calculations show a loss of #600, which indicates that the business did not make a profit during the year. Summary of Key Points

• Total Assets were calculated to be #13,400.
• Total Liabilities were #1,000.
• Owner's Equity at year-end was #12,400.
• The business incurred a loss of #600, not a profit.

Revision Summary

• Understand the components of assets and liabilities.
• Use the accounting equation to find Owner's Equity.
• Compare Owner's Equity at year-end with initial capital to determine profit or loss.
• Always double-check calculations to ensure accuracy.