Day: January 31, 2019

Accounting Multiple Choice Question – 31 January 2019

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

The following information relates to a business’s trading during the month of July.

  • Gross profit for the month – £35,000
  • Expenses for the month – £18,000
  • Net profit for the month – equals 17% of the sales for the month

The business’s Cost of Sales for the month of July is?

Select ONE answer:

  1. £52,000
  2. £53,000
  3. £65,000
  4. £100,000

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple choice question is suitable for Accounting KS5 classes.

The answer is 3
Net profit = Gross profit – Expenses = £35,000 – £18,000 = £17,000
£17,000 = 17% of sales
Therefore, Sales = £17,000 / 17 * 100 = £100,000
Cost of Sales = Sales – Gross Profit = £100,000 – £35,000 = £65,000

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