Financial Performance - HELP NEEDED

torresgbr

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:

luke1875

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.

torresgbr

Hi Luke. Yes that is great thank you very much. Thank you for taking the time to help me. Regards Karen