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march june 2018 – 10% profit margin

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AAA Exams › march june 2018 – 10% profit margin

  • This topic has 1 reply, 2 voices, and was last updated 6 years ago by Kim Smith.
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  • May 3, 2019 at 5:55 am #514821
    foeldh123
    Participant
    • Topics: 168
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    • ☆☆☆

    march june 2018, question 4, part (c), in the last sentence, it says Knott Co makes a 10% profit margin on all of its sales of aluminium. usually a company charges 10% based on it’s sales value therefore shouldn’t the profit be 77 million / 110 x 10 = 7million ?

    May 3, 2019 at 7:35 am #514823
    Kim Smith
    Keymaster
    • Topics: 135
    • Replies: 8312
    • ☆☆☆☆☆

    No – margin means that the % is of the sales value. It is “mark-up (on cost)” which would make sales 110% of cost.

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