Income statements

Identify two financial statements the directors must examine before CC expands. Explain why they would want to review each of these statements.

May/June 2017

FLD operates as a furniture retailer. It has 460 shops and 20 000 employees. Internal recruitment is used when new shop managers are recruited. The Managing Director wants to find out whether job rotation is the best motivation method for a large business to use. The Finance Director is examining FLD’s income statement. An extract appears in Table 2.1. She is worried that FLD’s gross profit is falling.

May/June 2025

BFF produces a selection of computer screens that it sells to other manufacturers. The Managing Director has been reviewing BFF’s income statement. She is concerned about the consequences of a rise in the cost of materials. She stated: ‘Improvements in technology have made our production methods better. BFF must stay competitive because imports of computer screens are rising.’ The Managing Director must decide whether BFF should raise its prices.

Oct/Nov 2019