2.3.1 Profit ​

Question 1

Calculate Profit

Answer 1

Revenue – Total
costs

Question 2

Calculate gross profit

Answer 2

Total revenue – Cost of sales

Question 3

Calculate Operating profit

Answer 3

= Gross
profit – Expenses

Question 4

calculate Profit for the year

Answer 4

Operating
profit – Finance costs

Question 5

Ways to improve profitability​

Answer 5

Raising prices – means increase prices will get more revenue ​

Lowering costs ​
By buying cheaper resources ​

Question 6

Distinction between profit and cash​

Answer 6

Cash is vital to a business than profit. A Business can survive at breakeven but will survive if there is no access to cash.​