Pracise Assesment 1 Task 6, HELP!

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ThomasD48
ThomasD48 Registered Posts: 3 New contributor 🐸
in Management Accounting: Decisions and Control
Can anyone please help me with this question? I managed to get the COS to be 1825000 through doing (225000*365)/45 but now I am stuck. Is there an easy way round this or am i over complicating it?

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  • Krisso
    Krisso Registered Posts: 124 Dedicated contributor 🦉
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    Hopefully this helps



    You have calculated Cost of sales correctly so COS must be 80% which means Sales will be the 100%
    You can then calculate gross profit and verify your figure by taking COS from your calculated sales
    Selling Costs and Admin costs are easy calculations just watch your rounding

    I have included basic calculations next to each line so hope you find this useful
  • ThomasD48
    ThomasD48 Registered Posts: 3 New contributor 🐸
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    Thankyou so much @Krisso

    i was looking online at another post and this is how they calculated it, wtf!

    To calculate Sales:

    GP% = GP/Sales
    GP%= (Sales - costs of sales)/sales

    20%=( sales - £1,825,000)/sales
    1/5 sales = sales - costs of sales
    sales - 1/5 sales = costs of sales
    5/5 sales - 1/5sales = CoS
    4/5 sales = CoS
    4/5 sales = £1,825,000
    Sales= £1,825,000*5/4
    sales = £2,281,250

    your way is so much easier and im kicking myself for not noticing haha, was there an easier way to calculate COS compared to the way i did it?


  • Krisso
    Krisso Registered Posts: 124 Dedicated contributor 🦉
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    I calculate COS the same way
  • jettimmax1
    jettimmax1 Registered Posts: 10 New contributor 🐸
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    Sorry, how is COS calculated here? thanks
  • Krisso
    Krisso Registered Posts: 124 Dedicated contributor 🦉
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    Jettimmax1 it is explained in this



    If you start with the COS figure given above and then follow each calculation in the last column it will show you how to get to the figures
  • jettimmax1
    jettimmax1 Registered Posts: 10 New contributor 🐸
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    Thank you

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