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trading and profit and loss account

Forums › CIMA Forums › trading and profit and loss account

  • This topic has 1 reply, 2 voices, and was last updated 8 years ago by AvatarJohn Moffat.
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  • September 2, 2017 at 10:53 am #405003
    Avatarbokamosojkelopang
    Member
    • Topics: 1
    • Replies: 0
    • ☆

    how do you find purchases when you are given sales, opening stock and closing stock

    September 3, 2017 at 11:06 am #405119
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54836
    • ☆☆☆☆☆

    You can’t unless you are told the profit margin (or mark-up %).

    Then you can calculate the cost of sales. Once you know the cost of sales, then you use the fact that cost of sales is equal to opening inventory plus purchases minus closing inventory. If you know the opening and closing inventories you can then calculate the purchases.

    Have you watched the free lectures? The lectures are a complete free course for BA3 and cover everything needed to be able to pass the exam well.

    (We stopped using the word ‘stock’ many years ago – it is called ‘inventory’.)

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