Q.1 Calculate the gross profit margin for Pearson & Litt for 2020.20192020Sales price per unitR15R19Variable cost per unitR6R7Fixed cost (FC) per annumR650 000R 855 500Fixed cost per unitR3R4Current assetsR450 600R560 700Current liabilitiesR510 000R780 000Retained profitR21 809R17 600Net SalesR2 900 320R 3 100 100Cost of salesR390 000R475 000

Formula used: Gross profit margin = [ ( Net sales - cost of sales ) / Net sales ] x 100

Answered: Q.1 Calculate the gross profit margin…

Q.1 Calculate the gross profit margin for Pearson & Litt for 2020. 2019 2020 Sales price per unit R15 R19 Variable cost per unit R6 R7 Fixed cost (FC) per annum R650 000 R 855 500

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Contingent Liabilities and Provisions

A contingent liability can be defined as a liability the occurrence of which is dependent upon the happening of an uncertain future event. It is generally recorded in the books only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly.

Question

Q.1 Calculate the gross profit margin for Pearson & Litt for 2020.
2019
2020
Sales price per unit
R15
R19
Variable cost per unit
R6
R7
Fixed cost (FC) per annum
R650 000
R 855 500
Fixed cost per unit
R3
R4
Current assets
R450 600
R560 700
Current liabilities
R510 000
R780 000
Retained profit
R21 809
R17 600
Net Sales
R2 900 320
R 3 100 100
Cost of sales
R390 000
R475 000

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10q-4