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MULTIPLE-CHOICE 1) Mark sells 2 bags of Haribo at school for £1.50 each. He bough the sweets on special offer from ASDA for £1 each. Has he made a profit.

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Presentation on theme: "MULTIPLE-CHOICE 1) Mark sells 2 bags of Haribo at school for £1.50 each. He bough the sweets on special offer from ASDA for £1 each. Has he made a profit."— Presentation transcript:

1 MULTIPLE-CHOICE 1) Mark sells 2 bags of Haribo at school for £1.50 each. He bough the sweets on special offer from ASDA for £1 each. Has he made a profit or loss?

2 MULTIPLE-CHOICE A business sells 300 ice creams at £1 each in one week. It costs £450 to buy the ice creams from the manufacturer. Profit or loss?

3 MULTIPLE-CHOICE 3) Sales revenue for a business selling sportswear is at an all time high at £2million for the financial year. However they have incurred costs from a flood at £1million, fixed costs are £200k and insurance premiums have increased to £500 for the year. Has the business made a profit or loss?

4 MULTIPLE-CHOICE In one day, a bakery sells:
200 doughnuts at £0.50 each It costs them £85 to manufacture the doughnuts and they have to pay the staff at £20 for one day. Have they made a profit or a loss?

5 MULTIPLE-CHOICE 1) Mark sells 2 bags of Haribo at school for £1.50 each. He bought the sweets on special offer from ASDA for £1 each. Has he made a profit or loss? Profit

6 MULTIPLE-CHOICE A business sells 300 ice creams at £1 each in one week. It costs £450 to buy the ice creams from the manufacturer. Profit or loss? Loss

7 MULTIPLE-CHOICE 3) Sales revenue for a business selling sportswear is at an all time high at £2million for the financial year. However they have incurred costs from a flood at £1million, fixed costs are £200k and insurance premiums have increased to £500 for the year. Has the business made a profit or loss? Profit

8 MULTIPLE-CHOICE In one day, a bakery sells:
200 doughnuts at £0.50 each It costs them £85 to manufacture the doughnuts and they have to pay the staff at £20 for one day. Have they made a profit or a loss? Loss

9 Learning Objectives UNIT TITLE: Unit 3: Accounts & Finance
LESSON TITLE: Profit & Loss Account COMPETENCY FOCUS: Key Skills (L5): you will be able to develop your numeracy skills to calculate financial transactions of a business and to interpret financial data. Learning Objectives By the end of the lesson, you should be able to… LO1) Identify the purpose of a profit & loss account (income statement) LO2) To complete a profit & loss account from information provided LO3) To analyse financial statements for a small business and suggest appropriate actions that the business can take to succeed

10 I can recognise the layout of the P&L Account, input data correctly and explain what the figures show: Competence level Descriptor Autonomous I can delve deeper into my calculations by fully explaining how my calculations explain the financial state of the business and I will evaluate how effective/ineffective their business activities have been for the organisation and make justified recommendations for improvement. Advanced As below but additionally I can use my calculations to begin to analyse the activities of my focus organisation and recommend strategies for improvement. Strong As below but additionally I can fully explain what the calculations show and explain the financial state of the business. Regular I can correctly input data into a P&L Account, calculate totals and then begin to explain what the calculations show. Guided Through basic calculations, I can input data correctly into a P&L Account.

11 Video Clip

12 What is a Profit & Loss Account
Often used to take to the Bank Manager when wanting to apply for a loan Sometimes called the ‘income statement’ Show profit/losses over a one year period

13 Quick Quiz Which 2 of the following are ways of improving a business’ gross profit? Sell the business to a competitor Reduce the business’ costs Reduce the business’ turnover Reduce productivity Reduce business efficiency Increase productivity

14 Quick Quiz Which 2 of the following are ways of improving a business’ gross profit? Sell the business to a competitor Reduce the business’ costs Reduce the business’ turnover Reduce productivity Reduce business efficiency Increase productivity

15 What is a Profit & Loss Account
There are 3 sections to the P&L account: Trading Account Profit & Loss Account Appropriation Account

16 What is a Profit & Loss Account
See pg Makes notes on what is included in each section of the P&L Account.

17 On a P&L Account… Gross Profit = Gross Sales – Cost of goods sold Gross profit The difference between sales revenue and the cost of making a product or providing a service, before deducting overhead, payroll, taxation, and interest payments.

18 What is a Profit & Loss Account
You can see from your revision guide what is included in each section. Teacher to go through each section with class.

19 Profit & Loss Account Complete task on Sports Warehouse Plc.
Teacher to go through each section with class.

20 Re-cap on P&L Account What is a P&L Account also known as?
What are the 3 section of a P&L Account?

21 TASK 1 Complete Workbook. [30mins]

22 TASK 2 You have 20mins to revise theory on Balance Sheets and Profit & Loss Account. You will now sit a test! [30mins]

23 TASK 3 Use the revision guidance notes to produce your own revision notes ready for the exam! [30mins]

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