Accounting Multiple Choice Question – 1 February 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 – £100,000
  • Expenses for the month – £50,000
  • Net profit for the month – equals 15% of the sales for the month

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

Select ONE answer:

  1. £233,333
  2. £200,000
  3. £133,333
  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 1
Net profit = Gross profit – Expenses = £100,000 – £50,000 = £50,000
£50,000 = 15% of sales
Therefore, Sales = £50,000 / 15 * 100 = £333,333
Cost of Sales = Sales – Gross Profit = £333,333 – £100,000 = £233,333

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