Unit 5

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
If you have a mark up of 50% with no closing stock figure, no cost of sales figure and no gross profit figure how do you find these figures?<BR><BR>Many thanks for any help

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Unit 5

    What information do you have? If you've got sales you can work out cost of sales and therefore gross profit but I can't see how you can work out stock unless you have other information.<BR><BR>Annette
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Unit 5

    Sales figure will equal 150%<BR>So Sales figure divide by 150 = (fig A)<BR>then (fig A) * 100 = Cost of Sales<BR>or (fig A) *50 = Gross Profit<BR><BR>Amanda
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Unit 5

    Annette,<BR><BR>Thanks for replying. I am looking at Harvey & company in the intermediate osbourne book.<BR><BR>total sales £16,396<BR>opening stock £62,995<BR>total purchases £9,075<BR><BR>Estimated stock is £45,000<BR>mark up of 50% on cost<BR><BR><BR>I have the answer book which says gross profit is £5,465<BR>cost of sales is £10,931<BR>Closing stock is £61,139<BR><BR>The answer book also says that if mark up is 50% then margin based on sales is 33 1/3? I dont get how they get this<BR><BR>Can you help?<BR><BR>Thanks<BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Unit 5

    Sales is 16396<BR>If mark up is 50% use mark-up (forget how they get margin as I dont get it ethier)<BR>So Cost of sales = ? which must be 100%<BR>Mark up from cost of sales is 50%<BR>So there for sales must be 150%<BR><BR>So take the sales figure and divide by 150<BR>16396 / 150 = 109.31<BR>Then 109.31 *50 = 5465 which is gross profit<BR>Therefore 16396 - 5465 = 10931 which is cost of sales<BR><BR>Then you can start the stock calculation<BR><BR>opening stock £62,995<BR>total purchases £9,075<BR>Closing stock ???<BR><BR>= Cost of sales = 10931<BR><BR>So what is the missing ?? stock figure <BR>62995 + 9075 - ?? = 10931<BR>?? = 61139<BR><BR>Does this help or not? Let me know and I will try to explain again!!<BR><BR>Amanda<BR><BR>PS this is the hardest question I have come across on the sims!! Its a mix between incomplete records and mark-up!<BR><BR><BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Unit 5

    Amanda,<BR><BR>It sounds good i will try it and let you know. I have also sent an email to osbourne books to see what the 331/3 is all about so i will let you know when i have an answer.<BR><BR>Thanks again,<BR><BR>Laura
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Unit 5

    It is pretty simple really:<BR><BR>Mark-up is the percentage on top of cost of goods sold that gives your sales figure<BR><BR>eg. A mark-up of 50% and cost of goods sold of £5000 gives a sales figure of £7500 (5000 x 150%)<BR><BR>Margin is the percentage of sales figure which is gross profit.<BR><BR>eg A margin of 33 1/3% and a sales figure of £7500 would give £2500 GP (33.3% of 7500)<BR>Taking the difference between the two figures gives cost of goods sold ie £5000
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Unit 5

    Yes I agree it is simple to do a Mark-up when you have the cost of sales figure and margin if you have the sales figure.<BR><BR>The questions are not so easy for all to understand when you have the SALES figure and MARK-UP question!!<BR><BR>Amanda

Categories

Privacy Policy