hey, me again! can someone pls help me with this question, i dont know what numbers go where? thanks so much and i promise this is the last question that i will ask regarding past papers! tysm xx
Hey again!
So in order to work this question out the first thing we need to do is work out the Cost Of Goods Sold (COGS) which is given by the formula:
Opening stock + purchases - closing stock = COGSMost questions will give you COGS but you should also know how to work it out
So now we sub in what we know:
36000 + 74500 - 6500 = 104000
Therefore COGS = $104000Now to find Gross Profit we use
Sales - COGS = Gross ProfitSub in what we know:
220000 - 104000 = 116000
Therefore Gross Profit = $116000Making the answer to question 5
ANow to find Net Profit we use
Gross Profit - Total Expenses = Net ProfitSo now we know that the rest of the figures we have been given are all expenses, these are:
Interest charges, Bad debts, Petrol expenses, Wages, Rent paid, Electricity and Advertising.
Sub into the formula now:
116000 - 40900 = 75100
Therefore Net Profit = $75100Making the answer to question 6
DHope this helped! (also feel free to ask as many questions as you need, it's what the forums are for!
)