WorksheetsAAT level 3 FAPS
Total questions: 13
Worksheet time: 7mins
A sole trader has responsibility for
preparing the accounts of the business
all aspects of their business
selling the products
completing spreadsheets
Unlimited liability means
the business is closed down because of too much debt
the owners' personal possessions can be used to cover the firm's debts
the bank will refuse to give loans to the business
the business will struggle to attract investors
Reinvested profit is when
some of the profit is kept in the firm rather than being given to the owners
the owners share of the profits is increased
the value of the business increases
the firm can attract more investors because the profits are high
A partnership has between 2 and 20
employees
shareholders
owners
customers
From financial statement analysis the creditors are interested to know
Liquidity
Profit
Efficiencies
Share capital
What is working equity?
Money owed to a business by debtors
Money that is tied up in investments or property
Money that a business can access immediately
What does an income statement show?
The financial performance of a business
A sales projection for a business
The value of a business
What is Gross Profit Margin (GPM) an indicator of?
The efficiency of a firm in making and selling its product.
The total revenue of a firm.
The net profit margin of a firm.
The return on capital employed by a firm.
What is the Gross Profit Margin percentage in the provided example where the Gross Profit is £438,700 and Sales are £956,500?
45.8%
50%
55%
60%
What is the Return on Capital Employed (ROCE) percentage if the Capital Employed is £1,456,000 and the Profit before taxation is £236,000?
16.2%
15.0%
18.5%
20.0%
Revenue = £100,000
Cost of sales = £50,000
Other expenses = £25,000
What is the gross profit?
£25,000
£50,000
£100,000
£75,000
Why might the gross profit margin go up?
Cost of sales have decreased
Cost of sales have increased
Operating (other) expenses have increased
Operating (other) expenses have decreased
Gross profit = £30,000
Total revenue = £100,000
Cost of sales = £70,000
Operating (other) expenses = £10,000
What is the gross profit margin?
80%
10%
70%
30%
