Gce Model Questions Vol1 2020 Commerce Question 5

Practice essay / theory question 5 from the 2020 Gce Model Questions Vol1 Commerce examination. This question covers Retail Trade .

Gce Model Questions Vol1 2020 Commerce Essay / Theory
Topic: Retail Trade
Question 5 GCE_MODEL_QUESTIONS_VOL1 • 2020 • COMMERCE • essay

A small retail shop sells two types of product: Type A (a fashion accessory) and Type B (a home‑decor item). The shop purchases each unit of Type A at ₦2,500 and each unit of Type B at ₦1,800. The selling price per unit of Type A is set at a 40 % markup on cost, while Type B is sold at a 30 % markup on cost. Fixed monthly costs (rent, salaries, utilities) amount to ₦150,000. In the most recent month, the shop sold 120 units of Type A and 200 units of Type B.

Question Parts

( a )
Calculate the total revenue for the month.
( b )
Determine the gross profit for each product type and the overall gross profit.
( c )
Compute the net profit (or loss) for the month after deducting the fixed costs.
( d )
The shop owner is considering increasing the markup on Type B to 45 % while keeping the selling price of Type A unchanged. Assuming the same sales volume, calculate the new net profit and comment on the impact on profitability.

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About This Question

This is Gce Model Questions Vol1 2020 Commerce Question 5. It is one of the essay questions from the 2020 Gce Model Questions Vol1 Commerce examination.

The question covers Retail Trade .

View More Gce Model Questions Vol1 2020 Commerce Questions More Gce Model Questions Vol1 Practice Questions Back to Questions

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