Topic 3b - income statement

Question 1

step 1

Answer 1

Sales (R)

Question 2

After sales (R)

Answer 2

(sales returns) (L)
(discount allowed) (L)

Question 3

step 2

Answer 3

Net sales (R)
Sales - (sales)

Question 4

step 3

Answer 4

Less: Cost of Sales / Cost of Goods Sold (L)

Question 5

after cost of sales / cogs

Answer 5

• freight inwards
• customs duty
• cartage inwards
• (discount received)

all (L)

Question 6

step 4

Answer 6

(total COGS) (R)
freight inwards + customs duty + cartage inwards - discount received

Question 7

step 5

Answer 7

Gross Profit (R)
net sales - total COGS

Question 8

step 6

Answer 8

title: add other income

Question 9

after add other income

Answer 9

• Profit from sale of asset (L)
• Interest income (L)

Question 10

step 7

Answer 10

Total Income (R)
gross profit + other income

Question 11

step 8

Answer 11

title: less other expenses

Question 12

step 9

Answer 12

title: selling and distributing expenses

Question 13

what goes in S+D expenses

Answer 13

advertising
bad debts
sales wages/salaries
freight outwards
cartage outwards
fuel

all (L)

Question 14

step 10

Answer 14

Total S+D expenses (R)

Question 15

step 11

Answer 15

title: general and administration expenses

Question 16

what goes in G+A expenses

Answer 16

electricity
insurance
office wages/salaries
telephone
stationary
prepaid rent/rent
accounting and bookkeeping

all (L)

Question 17

step 12

Answer 17

Total G+A expenses (R)

Question 18

step 13

Answer 18

title: financial expenses

Question 19

what goes in financial expenses

Answer 19

interest
interest on loan
bank fees

all (L)

Question 20

step 14

Answer 20

Total financial expenses (R)

Question 21

step 15

Answer 21

(Total expenses) (R)

Question 22

step 16 LAST STEP

Answer 22

Net profit (R)
total income - total expenses