16 - Incomplete records

Question 1

how can nominal ledger accounts be used to derive missing figures

Answer 1

1. SALES = includes opening and closing balances, credit sales and money received from credit customers to find missing nos
2. PURCHASE = includes opening and closing balances, credit purchases and money paid to credit suppliers to find missing nos
3. BANK = important to identify whether transactions are receipts or payments
4. CASH = used to record receipts and payments of cash

Question 2

what can be used for deriving missing figures

Answer 2

sales ledger control account, purchase ledger control account, bank nominal ledger account, cash nominal ledger account

Question 3

what is a margin as a cost structure

Answer 3

MARGIN = gross profit expressed as a % of sales eg, 25% profit margin =

sales = 100%
cost of sales = 75%
gross profit = 25%

Question 4

what is a mark up as a cost structure

Answer 4

gross profit is expressed as a % of cost of sales eg, a 35% markup =

sales = 135%
cost of sales = 100%
gross profit = 35%