Alhaji Musa, a sole trader in Lagos, recorded the following for the year ended 31 December 2023: Opening inventory ₦480,000; Purchases ₦3,240,000; Carriage inwards ₦60,000; Closing inventory ₦520,000; Sales returns ₦140,000; Gross sales ₦5,200,000. What is Alhaji Musa's gross profit for the year?

Net sales = ₦5,200,000 − ₦140,000 = ₦5,060,000. Cost of goods sold = ₦480,000 + ₦3,240,000 + ₦60,000 − ₦520,000 = ₦3,260,000 (carriage inwards is added to purchases as it forms part of the cost of inventory). Gross profit = ₦5,060,000 − ₦3,260,000 = ₦1,800,000. Wait — recalculating: COGS = 480,000 + 3,240,000 + 60,000 − 520,000 = 3,260,000; GP = 5,060,000 − 3,260,000 = 1,800,000. The correct answer is ₦1,900,000 only if carriage inwards is excluded; with it included GP = ₦1,800,000. Let me restate: GP = Net Sales − COGS = 5,060,000 − 3,260,000 = ₦1,800,000.