Chapter 1-The 5 Vital Numbers. Final Quiz

Choose the COGS for the following type of company:  AN ICE CREAM STORE.

Choose the COGS for the following type of company:  AN AUTO REPAIR SHOP.

Choose the COGS for the following type of company:  REAL ESTATE SALES OFFICE.

If a Restaurant sold $5,000 worth of food  over a 1-month period and paid $2,500 for the food that they sold, what is their Gross Profit?

If a Pet Store sold $20,000 worth of pet supplies over a 1-month period and they paid $15,000 for the supplies that they sold, what is their Gross Profit?

If your Cost of Goods Sold is $4,000 and your Overhead is $4,500, how much would your Gross Income need to be to Break Even?

If your COGS is $10,000 and your Overhead is $11,000, how much would your Gross Income need to be to Break Even?

How much would your Net Profit be for the week if you made $10,000 Gross Income in a week, your Cost of Goods Sold is $3,000 and your Overhead is $2,000?

How much would your Net Profit be for the week if you made $50,000 Gross Income in a week, your Cost of Goods Sold is $40,000 and your Overhead is $20,000?

How much would your Net Profit be if you made $10,000 Gross Income in a week, your Cost of Goods Sold is $10,000 and your Overhead is $1,000?

How much would your Net Profit be if you made $50,000 Gross Income in a week, your Cost of Goods Sold is $40,000 and your Overhead is $5,000?

What are the two types of profit?

What are the two types of expenses?

TRUE or FALSE?

Cost of Goods Sold are costs that only occur if you sell or deliver a product.   They are expenses directly related to the production, sale and delivery of that product.

TRUE or FALSE?

Overhead are costs that occur whether you sell a job or a product or not, such as the labor one pays for a girl behind the counter in the ice cream store, even when no ice cream was sold that day.

Would a Receptionist’s pay be COGS or Overhead?

What is Cost of Goods Sold also known as?

TRUE or FALSE?

The formula for calculating Gross Profit (Job Profit) is:

GROSS INCOME minus

JOB COSTS equals

GROSS PROFIT

What is Overhead expense also known as?

TRUE or FALSE?

Administrative staff are included under Cost of Goods Sold.

What are some of the expenses that are included under Overhead?

TRUE or FALSE?

The main reason that you would want to know the Overhead of the company is because once you have paid your Overhead, you start to make Net Profit.

What happens if you do not make enough Gross Profit to pay for the Overhead?

TRUE or FALSE?

Break Even is when one is making enough money to pay for your Cost of Goods Sold and your Overhead expenses and nothing more. There is no Net Profit.  Break Even is when Gross Profit = Overhead.

What do you subtract from the Gross Profit to get your Net Profit?