Chikis Posted October 15, 2014 Posted October 15, 2014 A shopkeeper made a net profit of N12,500 from his business in 1984. The cost price of all the goods he bought during amounted to N104000. His overheads amounted to N13 500. Calculate: (i) his average weekly sales during the year. (ii) his net profit as a percentage of his annual turnover. (Take 1 year = 52 weeks) What do the following terms mean as it is concerned with the solving of this problems: (i) turnover (ii) overheads (iii) net profit
studiot Posted October 15, 2014 Posted October 15, 2014 (edited) Turnover = sales ie it is just another word for total takings. Annual turnover = annual sales = (average weekly sales ) x 52 Net Profit = Sales - Costs Costs = Cost of goods + overheads Edited October 15, 2014 by studiot
studiot Posted October 15, 2014 Posted October 15, 2014 What is overhead? Well you said is was N13500 If you are asking what does overhead mean, it is the amount of money you must spend to maintain a shop, market stall or whatever the trader has. You said he was a shopkeeper so his shop costs him the same amount , whether he sells anything or not (electricity, water, perhaps rent, insurance etc) 1
Chikis Posted October 17, 2014 Author Posted October 17, 2014 (edited) Since Selling price = cost price + profit. Total sales would be N104000 + N12500 = N116500. Could this be right? Average weekly sale would be [math]\frac{N116500}{52}[/math] Edited October 17, 2014 by Chikis
Chikis Posted October 18, 2014 Author Posted October 18, 2014 (edited) Ok. Let say his total cost = overheads + cost price of all goods = 13500 + 104000 = N117500 Right? Sales would be cost + profit = 117500 + 12500 = 130000 average sales would be [math]130000\div52[/math] = N2500 Is this right? Edited October 18, 2014 by Chikis
studiot Posted October 18, 2014 Posted October 18, 2014 Yup that's it. This one was really too easy, compared to the last one.
Chikis Posted October 18, 2014 Author Posted October 18, 2014 (edited) As a percentage of turnover, net profit for 1984 was [math]\frac{N12500}{N130000}\times100[/math] = 9.615% approximately. Edited October 18, 2014 by Chikis
studiot Posted October 18, 2014 Posted October 18, 2014 9.6% I wish my bank gave me that much interest!
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