A-LevelAccountingAnalysis and Interpretation of Financial StatementsOct/Nov 2010Paper 1 Q221 Mark
A company's gross profit ratio for the year ended 31 December 2008 was 25%. This increases to 28% for the year ended 31 December 2009. What could have been responsible for the increase?
Aan increase in the cost of purchases during 2009
Ban increase in the volume of sales during 2009
Can over-valuation of inventory (stock) as at 31 December 2009
Dan under-valuation of inventory (stock) as at 31 December 2009
✓ Correct Answer
The correct answer is C. This question tests the candidate's understanding of analysis and interpretation of financial statements within the Accountingsyllabus. The examiner's mark scheme requires...
📋 Examiner Report & Trap Analysis
Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...
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