Unit 3

Gross profit formula is

• Turnover - cost of sales

• Cost of sales - turnover

Turnover formula is

• Turnover - cost of sales

• Cost of sales - turnover

Net profit formula is

• Gross profit - expenses

• expenses - gross profit

Cost of goods sold formula is

• opening inventory + purchases - closing inventory

• closing inventory +opening inventory + purchases

• purchases + closing inventory +opening inventory

Net cash formula is

• Total Inflows – Total Outflows

• •Previous month’s closing balance

Opening balance formula is

• Previous months closing

• Previous months opening balance

Total outflows formula is

• all the money going out the business

• All the money coming in to the business

Straight-line depreciation formula is

• Residual value /number of years

• Historic value / number of years

• Its neither

Reducing balance depreciation is taking a % off the balance each year

• False

• True

Calculate the reducing balance depreciation for a car worth £1000 and reduces by 20% for the next 4 years