Answer:
$294,000
Explanation:
Data provided in the question:
Profit during the first year = $30,000
Increase in profit each year = $4,000
Now,
Profit for the current year = Profit for the previous year + $4,000
Therefore,
Year Current year profit
1 $30,000
2 $34,000 [$30,000 + $4.000]
3 $38,000 [$34,000 + $4.000]
4 $42,000 [$38,000 + $4.000]
5 $46,000 [$42,000 + $4.000]
6 $50,000 [$46,000 + $4.000]
7 $54,000 [$50,000 + $4.000]
Hence,
The total profit during the first 7 years of business = ∑ (Current year profit)
= $30,000 + $34,000 + $38,000 + $42,000 + $46,000 + $50,000 + $54,000
= $294,000
