I don't think its going to, I hate it when its like this. I wish I could go home and work on my own business instead of sitting here bored out of my brains!!
You could always take the time to study something.
Why not do a google search on SSAP9 or FRS12 or better still FRS15.
How about revising sum of digits or time series analysis or Ratio's.
Don't see how anyone can ever have time to be bored in this business there's just so much to learn.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Your bored, jeez the highlight of my day so far is my 3 yr old telling me the balloons i've just blown up look like boobies ............hmmmm actually they do, thats me happy for the next half hour.
You're a bad man Steve! Out of interest how big are these balloons? No don't answer!
No time to be bored, I can't believe it's Friday already. Had to see a new client this morning and nearly didn't make it on time because I thought it was still Thursday!
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
You're a bad man Steve! Out of interest how big are these balloons? No don't answer!
No time to be bored, I can't believe it's Friday already. Had to see a new client this morning and nearly didn't make it on time because I thought it was still Thursday!
Not that big but because I haven't blown them up properly they appear to have n................. Oh just seen the dan't answer that
Good call Steve but unfortunately you've actually applied the markup % to the sales.
A margin of 20% on sales equates to a gross profit of 25% (markup) on cost of sales.
So, total margin is 20% * 150,000 = 30,000
Cost of sales is 150,000 - 30,000 = 120,000
So purchases are 120,000 + 15,000 - 10,000 = £125,000
To recheck it from the margin. £125,000 * 1.2 = £150,000
Sorry, wasn't going to make them straight forwards as wanted to relieve additionsbookkeeping's boredom.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Lots of ways of getting to the answer. I took the longhand way taking it back to a margin as it explained it better in stages but yours is the way that you would do it normally.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Excellent. Right, if it's not time to escape for the day yet lets try one the other way around.
A business achieves a margin of 25% on sales.
Opening stock was £18,000 Closing Stock was £28,000 Purchases total £300,000
What are the sales for the period?
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
No, that's the answer that you would get if you apply the 25% margin to cost of sales.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
But imagine that the there or thereabouts metodology didn't exist. What would the exact figure be?
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
For everyone else scratching their heads over this. Doing it long hand again :
25% margin = 33.3333 (recurring) mark up
Cost of sales = 18,000+300,000-28,000=290,000
£290,000 * 33.3333 (recurring) = 96,666.66
£290,000 + 96,666.66 = 386,667. (so £386,670 was near enough for me).
No call for a change of career Angela. These one's aren't meant to be completely straight forwards. They're just Friday afternoon brain teasers.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
And I'm probably going to regret my response as I'm sure that other do it differently but the way that I do it is :
Convert the margin to a fraction so 25% = 1/4
To convert a margin to a markup is 1 over the margins denominator less the numerator. So, the calculation would be :
1 over 4-1 = 1 over 3 or 1/3 which is 33.33333 (recurring) %
Whilst we're here. To convert a Markup to a Margin. Taking the previous example of 25% markup
Convert to a fraction (25% = 1/4)
To convert a markup to a margin is then 1 over the margins denominator plus the numerator. So, the calculation would be :
1 over 4+1 = 1 over 5 or 1/5 which is 20%
I'm betting that printers all over the land just sprang into action on this thread!
Rob, go on, now tell us the proper way of doing this!
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Ooh, cheers Steve, hadn't noticed that I was so close now!
Whats the betting that I'm still a Guru at 1001
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Actually Shaun, I struggled with that last one, I couldn't figure out the method (it has been a very long time!), so I worked out the £290k and banged in a few numbers until I got the answer!
Actually Shaun, I struggled with that last one, I couldn't figure out the method (it has been a very long time!), so I worked out the £290k and banged in a few numbers until I got the answer!
Thank you Shaun, that is excellent, and to add to your fan club................my printer sprang into action.......................here you are................before I had finished reading your post
glad to be of service and hope we stopped additionsbookkeeping from being too bored.
Maybe we should make this a regular Friday afternoon thing? (so gives me an entire week to think up cunning questions).
Think that we've done the basics on Margins and Markups now. Any preferences on the next subject?
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Mmm, Internal Rate of Return. Like your thinking but probably not the territory for most of our regulars.
Also thought about Ratio and Variance analysis questions but they're not really applicable either.
Might go for some VAT questions. Always topical and something that people could always do with knowing that little bit more about.
Of course, this means that Bills going to be sitting there all week now waiting for the Friday afternoon quiz!
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
very probably as this means that there's only four more to go... I know that I should do a few posts just to see what happens but that seems like cheating to me.
No matter what the question on VAT it does seem that we can end up having a debate about it so I'm going to have to be careful not to ask anything that has mutliple possible answers. Thinking here about the deminimus thread from some time back where business items were purchased on a private credit card.
Well, four more to go!
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.