Day: November 17, 2020

The draft accounts of a business for the year ended 31 December 2019 included the following: turnover £560,000  & gross profit £120,000

It was subsequently discovered that the closing stock was understated by £20,000.

What was the gross profit percentage after correcting this error?

Select ONE answer:

1. 17.9%
2. 20.7%
3. 21.4%
4. 25.0%

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 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – (£120k + £20k) / £560k = 25%

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