A Company wishes to earn a 20% profit margin on selling price. ________is the profit mark up on cost, which will achieve the required profit margin?
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Solution
Here profit margin on sale is given and we are required to find the profit margin on cost. This can be done
as follows:
Let the selling price be x
Then profit = 20% of x = .2x
Thus cost price = selling price – profit = x – .2x = 0.8x
And the markup on cost will be = 0.2/0.8 × 100 = 25%
X draws a bill on Y. X endorsed the bill to Z. ________will be the payee of the bill.
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Solution
Z will be payee of bill.
If a venturer draws a bill on his co-venturer and if the drawer discounts the bill with same sets of books maintained, the discounting charges will be borne by________.
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Solution
In the given case, discount charges will be recorded in Memorandum A/c.
A proforma invoice is sent by ________
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Solution
Performa invoice is sent by consignor to consignee.
Interest on capital will be paid to the partners if provided for in the agreement but only from________
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Solution
Interest on capital to be paid only from profits in given case.
The balance of the petty cash is ______.
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Solution
Petty cash balance is asset.
Outgoing partner is compensated for parting with firm’s future profits in favour of remaining partners. The remaining partners contribute to such compensation amount in ______
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Solution
Remaining partners contribute to compensation amount in gaining ratio.
Dividends are usually paid as a percentage of ______
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Solution
Dividends are paid on paid up capital.
Accounting policies refer to specific accounting ________.
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Solution
Accounting policies refer to accounting principles and methods of applying those principles.
Economic life of an enterprise is split into the periodic interval as per ________ concept.
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Solution
Due to periodicity concept, life of an enterprise is divided into accounting periods (intervals).