AQA A2 BUSS3, 13 June 2013

Original post by sofiax0

also is operating profit the same as gross profit :s-smilie:

??? i hate that maths-y bit of business </3

Operating profit is the same as net profit (technically there is a different but they conflate them for A2, and assume them the same).

Gross profit margin is revenue minus cost of sales and net profit margin is revenue minus cost of sales and other expenses.

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Reply 62

username1136783

Original post by will2348

okay so in terms of roce its: net profit/ total equity + non-current liabilities?

:smile:

Reply 63

username818763

I'm re-sitting this. I need to learn all the ratios and exam technique :s-smilie:

Reply 64

Original post by sofiax0

also is operating profit the same as gross profit :s-smilie:

??? i hate that maths-y bit of business </3

Revenue - cost of sales = gross profit

gross profit - expenses = operating profit

operating profit - finance cost = profit before tax

profit before tax - tax = profit for the year (Net profit).

To answer your question, no they are not the same thing.

(edited 10 years ago)

Reply 65

Original post by sofiax0

okay so in terms of roce its: net profit/ total equity + non-current liabilities?

:smile:

That's right.

Total Equity = Shareholders Capital + Reserves/Retained Earnings

Non-Current Liabilities = Long-Term Loans :smile:

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Reply 66

jacktomos95

Original post by arnoob

I'm re-sitting this. I need to learn all the ratios and exam technique :s-smilie:

You don't need to know them as we get given the formula sheet

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Reply 67

Original post by sofiax0

also is operating profit the same as gross profit :s-smilie:

??? i hate that maths-y bit of business </3

Gross Profit = Sales Revenue - Cost of Sales

Operating Profit = Gross Profit - Overheads

Reply 68

username818763

Original post by jacktomos95

You don't need to know them as we get given the formula sheet

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Sorry, I mean I need to practice them :redface:

Reply 69

Do they give you the forumlas for Investment Appraisal?

Reply 70

Original post by Indyy

Do they give you the forumlas for Investment Appraisal?

nope.

Reply 71

For Payback period, do we have to work out the cumulative returns or is that part of the column will be done already?

Reply 72

Also, how do i know what discount rate to use for NPV?

So many damn questions i have....

Reply 73

Original post by Indyy

Also, how do i know what discount rate to use for NPV?

So many damn questions i have....

For Payback, just give the answer in years and months or years and weeks. You might need to do that as part of the working out but it's not required in the answer. For NPV they will give the discount rate, if not, then use whatever interest rate is stated in the case study. Or you might be asked to choose, so go with the one that reflects the risk/current interest rate/or harshest measure. Never known them not to directly give it to you though, it'd be unusual for them to do it otherwise.

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Reply 74

A00

Im so bad at the maths part. I literally lose all my marks on those parts. Anyone have any advice or material i can practise

Reply 75

Original post by A00

Im so bad at the maths part. I literally lose all my marks on those parts. Anyone have any advice or material i can practise

Just look at past papers and practice the ratios and there should be at least one or two papers with investment appraisal.

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Reply 76

Anyone else think a question from the finance section will come up? They didnt ask one in jan 2013.

Reply 77

CharlieTT

Original post by Infamous12

Anyone else think a question from the finance section will come up? They didnt ask one in jan 2013.

Probably I'm revising Finance a tonne right now.

Reply 78