CourseCourseConceptConceptDocsDocuments

Edexcel IGCSE Business Studies 3.5.1 Calculating and Analysing Accounting Ratios Questions

Practise selecting figures from accounts, calculating ratios accurately and using the result to judge profitability, liquidity or performance.

Syllabus
First assessment 2019
Course
Business Studies 4BS1

Exam points

  • calculate gross profit margin, operating profit margin, ROCE, current ratio or acid test to two decimals
  • show formula substitution clearly when using revenue, profit, assets, liabilities or capital employed
  • interpret a calculated ratio to judge profitability, liquidity or performance in the business context

Edexcel IGCSE Business Studies 3.5.1 Calculating and Analysing Accounting Ratios Questions question 1

[Maximum number: 3]

IKEA is a well-known home furniture retailer with stores throughout the world. It was started in 1943 by Ingvar Kamprad when he was given some money by his father for doing well at school. He wanted to produce furniture at a price that people could afford to buy.

He realised that transporting furniture to customers was difficult as goods were often damaged. He developed flat packs to avoid damage. A flat pack contained all the materials needed to self-assemble a table, a chair or a bed.

All IKEA stores are run as franchises.

Question (a)

(a)

An IKEA dining table costs IKEA 3800 SEK to make. The table sells for 4400 SEK.

Which one of the following is the correct markup?

Select one answer.

A

1.16%

B

13.64%

C

15.79%

D

115.79%

[ 1 ]

Question (b)

(b)

Figure 2 is an extract from IKEA's Statement of Income for 2020.

Figure 2

Figure 2

Calculate, to two decimal places, the gross profit margin for 2020. You are advised to show your working.

[ 2 ]
All question bank results loaded