Help Required getting my head around missing figures in order to complete accounts

Flyby

Hi,

I'm on Chapter 14 Osbourne books Account Prep 1 and 2. I have to say I really have to understand things in order for it to sink in, I thought I was making good headway but am struggling with my assignment with premier (assignment 2 ap2 - Michael Mckintosh), so if anybody can help me on the opening question it will be much appreciated, in the most basic of explanations please.:confused1:

roy ramphul

Markup is always based on cost of sales.

Margin is always based on sales.

Excercise 14.1 we are given cost of sales is £200,000 and the markup is 30%

Therefore we can use the markup formula to work out the gross profit.

Gross Profit = 30% of £200,000= £60,000.

Now we can work out the sales value by adding Gross profit to Cost Of Sales.

Therefore Sales = £200,000+ £60,000=£260,000

liveprincess

even easier way 200000*130/100=260000

aaron0121

easiest way 200000*1.3=260000