Unit 17-IAP Top Up questions

JoDu

Hi all,
Question-Nothing has changed with regards to turnover or profit levels, what would you expect to happen to the fixed assets and stock balances?
Is this one of those glaringly obvious questions which needs a short reponse or am I being a divvy! Any help would be appreciated!!!
Thanks, x:001_smile:

visha

If this is a top up question then it is not a trick question.

You will need to refer to the skills test that you have just attempted.

This top up question is trying to plug in the gap in you knowledge and understanding.

Now let us consider your question!

If the turnover has not changed and the gross and net profit margins remain the same what would happen to the Assets?

Where does the profit end up?

Which assets do you think will go up and which assets will go down.

You can write your assumptions and then attempt to demonstrate your understanding of the profit’s effect of different types of assets. Make sure you give your reasons of your statement to demonstrate your understanding.

Good luck!