Actual Sales Revenue (video below)

A sole trader fixes his prices to achieve a gross profit percentage on sales revenue of 25%. All his sales are for cash. He suspects that one of his sales assistants is stealing cash from sales revenue.

His trading account for the month of July 20X5 is as follows:

$

Recorded sales revenue       39,000

Cost of sales                           30,000

Gross profit                            9,000

Assuming that the cost of sales figure is correct, how much cash could the sales assistant have taken?

Answer

Margin = (sale –cost)/sale = 25%, so we can find sale

Cost of sales = $30,000

Therefore sales should be = $30,000 x 100/75 = $40,000

Theft = $40,000 – 39,000  = $1,000

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