QUESTION 1 If sales revenue is $600,000 and cost of sales is $450,000; the gross profit margin is: 25% 33% 67% 75% 2  QUESTIONS Which of these would not be recorded as increasing income on 13 January? Cash sale on 13 January Cash sale on 31 January Credit sale on 13 January Sale where $2,000 is paid on 13 January and the balance of $3,000 is paid on 5 February 3  Sbitany has an issue of $1,000 par value bonds with a 14 percent annual coupon interest rate

1 

gross profit=Sales-Cost of sales

=600,000-450,000

=$150,000

gross profit margin=gross profit/Sales

=150,000/600,000

=25%

2 

Answer :-

Cash sale on 31 January

Explanation :-

Cash sale on 31 January would not increase the income on 13 January because the sale is done on 31 January ,so, it would increase income also on 31 January .

Explanation for rejection of other options :-

In all other options, the sale is done on 13 January so, it would increase income on 13 January irrespective of whether the sale is cash sale or credit sale .

3 

Annual coupon=1000*14%=140

Hence current value=Annual coupon*Present value of annuity factor(12%,10)+1000*Present value of discounting factor(12%,10)

=140*5.65022303+1000*0.321973237

=$1113.00(Approx)

NOTE:

1.Present value of annuity=Annuity[1-(1+interest rate)^-time period]/rate

=140[1-(1.12)^-10]/0.12

=140*5.65022303

2.Present value of discounting factor=1000/1.12^10

=1000*0.321973237