Using the given information, Calculate the following for the year ended 31 December 2023: (i) Mark-up…

Question

Using the given information, Calculate the following for the year ended 31 December 2023: (i) Mark-up percentage (ii) Net profit percentage

ScanSolve AI Tutor · Accepted Answer

Here are the calculations based on the provided information:

Calculate the Cost of Goods Sold (COGS).
$\text{COGS} = \text{Opening Inventory} + \text{Purchases} - \text{Closing Inventory}$ $\text{COGS} = \text{K}60,000 + \text{K}200,000 - \text{K}70,000$ $\text{COGS} = \text{K}190,000$
Calculate the Gross Profit.
$\text{Gross Profit} = \text{Sales} - \text{COGS}$ $\text{Gross Profit} = \text{K}300,000 - \text{K}190,000$ $\text{Gross Profit} = \text{K}110,000$
Calculate the Mark-up percentage.
$\text{Mark-up Percentage} = \left( \frac{\text{Gross Profit}}{\text{COGS}} \right) \times 100\%$ $\text{Mark-up Percentage} = \left( \frac{\text{K}110,000}{\text{K}190,000} \right) \times 100\%$ $\text{Mark-up Percentage} \approx \boxed{\text{57.89\%}}$
- ii) Expenses
The expenses are directly given in the problem.
$\text{Expenses} = \boxed{\text{K}50,000.00}$
- iii) Net profit percentage
Calculate the Net Profit.
$\text{Net Profit} = \text{Gross Profit} - \text{Expenses}$ $\text{Net Profit} = \text{K}110,000 - \text{K}50,000$ $\text{Net Profit} = \text{K}60,000$
Calculate the Net Profit percentage.
$\text{Net Profit Percentage} = \left( \frac{\text{Net Profit}}{\text{Sales}} \right) \times 100\%$ $\text{Net Profit Percentage} = \left( \frac{\text{K}60,000}{\text{K}300,000} \right) \times 100\%$ $\text{Net Profit Percentage} = \boxed{\text{20\%}}$

Using the given information, Calculate the following for the year ended 31 December 2023: (i) Mark-up percentage (ii) Net profit percentage