A-LevelAccountingAnalysis and communication of accounting information9706/12 · May/June 2012 · Q181 Mark
For some years a business has given 2% cash discount to its customers and lost 3% of its inventory to pilferage by staff. On 1 January, the business changed the rate of cash discount to 5% and introduced a new inventory control system that stopped the pilferage. Which effect do these changes have on the gross profit to sales ratio? change in cash discount new inventory control system decrease no effect increase no effect no effect decrease no effect increase
Adecrease no effect
Bincrease no effect
Cno effect decrease
Dno effect increase
✓ Correct answer
D: no effect increase
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