Question

Arrange the following items related to the Statement of Profit and Loss in a sequence:
(A) Profit before extraordinary items and tax
(B) Profit before tax
(C) Cost of materials consumed
(D) Revenue from operations
Choose the correct answer from the options given below:

• A. (A), (B), (C), (D)
• B. (B), (A), (C), (D)
• C. (C), (D), (A), (B)
• D. (D), (C), (A), (B)

Hint:

Follow the format of the Statement of Profit and Loss: revenue, then expenses, then profit before extraordinary items and tax, then profit before tax.

Answer 1

The Correct Option is D

Step 1: Think in terms of a calculation:
Profit is worked out as income minus expenses. So income must come first, then expenses, then the profit figures.

Step 2: Place the income and expense:
Revenue from operations is income, so D is first. Cost of materials consumed is an expense, so C comes after D.

Step 3: Place the two profit figures:
Profit before extraordinary items and tax is reached first after expenses. Profit before tax comes after extraordinary items are adjusted. So A comes before B.

Step 4: Choose:
The order D, C, A, B appears in option 4 only. Options 1 and 2 start with a profit line, and option 3 starts with an expense, so none of them can be right.

Final Answer:
Option 4 is correct. \[\boxed{\text{D, C, A, B}}\]