(a) What is turnover?
(b) The following information relates to Mrs Lulu, a trader.
| Goods | selling price N |
cost price N |
selling expenses N |
| Buckets Boxes Bournvita Lace material |
4,000 5,000 6,000 12,000 |
3,500 4,000 5,500 10,500 |
400 250 300 1,000 |
(i) Calculate the gross profit percentage on each item.
(ii) Calculate the net profit on each item.
Explanation
(a) The term turnover refers to the total net sales of a business in a given period
(i) Gross Profit = Selling price – Cost price
Gross profit% = Gross profit x 100
Sales 1
Buckets GP = 4000 – 3500 = 500
GP% 500 x 100 = 12.5%
4000 1
Boxes GP 5000 – 4000 = 1,000
GP% 1000 x 100 = 20%
5000 1
Bournvita GP 6000 – 55oo = 500
GP% 500 x 100 = 8.3
6000 1
Lace Materials GP 12000 – 10500 = 1500
GP% 1500 x 100 = 12.5%
12000 1 Net Profit
Gross profit – Expenses = Net profit
Buckets 500 – 400 = 100
Boxes 1000 – 250 = 750
Bournvita 500 – 300 = 200
Lace Materials 1500 – 1000 = 500