1. £££ Sales10,000 Less returns inwards150 9,850 Opening Stock350 Purchases1,000 Less returns outwards50950 Closing Stock200 Cost of Goods Sold1,100 Gross Profit8,750 Add Discounts received150 8,900 Less expenses Rates and insurance1,000 Less prepayment200800 Salaries2,000 Add accrual3002,300 Heat and light500 Discounts allowed250 Net Profit48,346 Number of goods sold x SP Goods which have been returned by customers therefore must be deducted from sales revenue Stock held at the beginning of trading Stock which has been returned to the supplier Opening stock + purchases minus closing stock Sales minus COS Discounts given by supplier for buying in bulk TOTAL GROSS PROFIT End of trading account Money already paid and so must be deducted from expenses. Amounts still owing from last trading period Discounts given to customers for buying in bulk or repeat purchasing Gross Profit minus Expenses Trading, Profit and Loss Account of Hunter’s for period ended 31 Dec 2008

2. Sales A company’s main source of income. This is how they generate income to spend on materials and pay staff. It is calculated by: Sales Revenue = SP X No sold