CHAPTER 25 – FINAL ACCOUNTS: INCOME STATEMENT 1 tsio 1. Copy and fill in the blanks.
a. A ___________ period is a given portion of time in which a business has bought and sold goods or services.
b. If the sales are greater than the cost of sales, the business made a gross ___________. If the cost of sales is greater than the sales, the business made a gross ___________.
c. ___________ stock is the value of the goods in stock at the beginning of the trading period. d. The most efficient level of stock for a business is called the ___________ level. e. Counting the goods held by a business at a particular time is called ___________.
f. The ___________ is the percentage amount added to the cost price of goods to cover expenses and provide a profit.
g. The percentage difference between the cost price and the selling price of goods is called the ___________.
2. What information can does a business get by preparing income statement 1?
3. Explain what is meant by the following terms: a. Carriage inwards b. Import/customs duty c. Cost of sales.
4. Copy and complete the following income statement 1. Income Statement 1
€ Sales
Less cost of sales Opening stock Purchases
Carriage inwards
Cost of goods available for sale Less ___________ ___________ ___________ Gross profit
22,000 88,000 1,200
___________ 30,000
___________ ___________
5. Outline the problems that may be caused for a business by having too much stock. 6. Explain one method of using technology in stocktaking. 7. Explain the difference between the cost price and retail price of goods.
