Accounting Multiple Choice Question – 30 March 2020

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

A firm’s gross profit margin is 20%. Its mark-up on cost is?

Select ONE answer:

  1. 16 2/3rds %
  2. 22%
  3. 25%
  4. 30%

 

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

  1. Not correct
  2. Not correct
  3. Correct – Gross Profit Margin = Gross Profit as a percentage of selling price = 20%.  Let the selling price = £100.  Therefore, gross profit = £20.  Therefore, cost = £80.  The mark-up on cost = Profit as a percentage of cost price.  £20 / £80 = 25%.
  4. Not correct

 

 

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