CAF-1 · Chapter 12 · Question 5 of 15
When dealing with incomplete records, how can the Cost of Sales be mathematically derived if the sales figure and the gross profit margin percentage are known?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Cost of Sales = Sales × (100 - margin) / 100
Explanation
When the profit margin is given as a percentage of sales, the formula to find the cost of goods sold from the sales figure is: Cost = Sales × (100 - margin) / 100.
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