Financial Performance  HELP NEEDED
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torresgbr
Registered Posts: 38 Regular contributor ⭐
Hello
I am due to resit my FP exam on Thursday and am stuck with a question and wondered if anyone could help
I have to calculate the Profit to the nearest £ and Sales Revenue to the nearest £
Net Assets £175,000
Return on Net Assets 13%
Profit Margin 14%
Gearing 32.75%
Profit to the nearest £  I have calculated 175x13% = £22750 (which is the correct answer)
Sales Revenue  the answer is £162,500 but can't work out how I get to that
Thanks in advance
Karen :thumbup1:
I am due to resit my FP exam on Thursday and am stuck with a question and wondered if anyone could help
I have to calculate the Profit to the nearest £ and Sales Revenue to the nearest £
Net Assets £175,000
Return on Net Assets 13%
Profit Margin 14%
Gearing 32.75%
Profit to the nearest £  I have calculated 175x13% = £22750 (which is the correct answer)
Sales Revenue  the answer is £162,500 but can't work out how I get to that
Thanks in advance
Karen :thumbup1:
0
Comments

Hi Karen
You have worked out that the profit is £22,750 and from the information that you are given you know the profit margin is 14%
Gross profit margin is profit over sales revenue.
22,750
x 100 = 0.14 or 14%
Sales
So if £22,750 is equal to 14%,
(£22,750 / 14) x 100 = £162,500
Hope that helps.
0 
Hi Luke. Yes that is great thank you very much. Thank you for taking the time to help me. Regards Karen0
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