hard20 pts · first answer countsaudit-planning

Profit swings around zero

A company’s profit before tax was ₹5 crore, then ₹0.2 crore, and is expected to be ₹3 crore this year. What is a sensible approach to the benchmark?

A.Always use this year’s profit figure, however small it isB.Use the lowest profit of the last five years to be safeC.Average several years’ profit, or use a benchmark like revenueD.Use share capital instead, as it rarely changes year to year

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Profit swings around zero

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