| N | |
| sales | 12,000 |
| opening stock | 3,000 |
| purchases | 7,000 |
| closing stock | 2,000 |
| wages | 500 |
| Transport | 400 |
| electricity | 300 |
From the above figures, calculate (showing all workings) the
(a) cost of goods sold.
(b) net profit percentage.
(c) rate of turnover.
Explanation
(a) Cost of goods sold = opening stock + purchases – closing stock
cost of goods sold N
opening stock 3,000
purchases 7,000
10,000
Less closing stock 2,000
cost of goods sold 8,000
(b) Net profit percentage
sales 12,000
cost of goods sold 8,000
Gross profit 4,000Less expenses;
wages 500
Transport 400
electricity 300 1,200
Net profit 2,800
Net profit percentage = Net profit * 100 / sales
2800/12000 * 100
23.33 = 23%
(c) Rate of turnover = cost of goods sold / Average stock
Average stock = opening stock + closing stock / 2
= 3000 + 2000 / 2 = 2500
cost of goods sold =
opening stock 3,000
purchases 7,000 10,000less closing stock; 2000
cost of goods sold 8,000
Rate of turnover = 8,000 / 2500 = 3.2 time