Do Now Activity: Answer the following questions:- What is Profit? What is Cost of Sales?

1. Do Now Activity: Answer the following questions:- What is Profit? What is Cost of Sales? What is an Expense?

2. Activity: These are the items in an Income Statement. Sadly they are not in order – Put them in correct Order

4. The Income Statement Sales: Income generated by a company's sales operations. Cost of Sales: The costs directly related to the purchase or production of whatever the company sells Gross Profit: Revenue/Sales minus the cost of goods sold. Expenses: The indirect costs incurred by a business that result from generating revenue. They include parts, wages, utilities, etc Net Profit: Gross profit less expenses in an accounting period. Purpose: Shows the income and expenses (net profit) of the business for a period

5. Lifesystems is a small company selling First Aid packs. • In 2020:- • It sold $100,000 worth of ice packs. • It cost them $30,000 to buy the packs. • It paid $20,000 in wages, $3,000 in rent and $5000 in interest on a mortgage. Calculate:- Gross Profit Net Profit

6. Lifesystemsis a small company selling ice packs for sporting injuries. In 2020:- • It sold $100,000 worth of ice packs. It cost them $30,000 to buy the packs. • It paid $20,000 in wages, $3,000 in rent and $5000 in interest. Activity: Create a full Income Statement for Lifesystems.

7. Answer