Transactions increasing net profit

Steps:

• Recall profit formula: Net profit = Total revenue - Total expenses.
• Evaluate each item: Determine if it raises revenue, lowers expenses, or has no direct profit impact.
• Item 1 increases expenses (e.g., additional provision), reducing profit.
• Item 2 boosts revenue (e.g., interest received), increasing profit.
• Item 3 reduces expenses (e.g., reversal of prior provision), increasing profit.
• Item 4 increases expenses (e.g., impairment loss), reducing profit.

Why C is correct:

• Items 2 and 3 raise revenue or cut expenses, directly increasing net profit per the formula.

Why the others are wrong:

• A includes item 1, which adds expenses and lowers profit.
• B includes items 1 and 4, both adding expenses and reducing profit.
• D includes item 4, which adds expenses and lowers profit.

Final answer: C