20. Profit and loss accounts

20. Profit and loss accounts


Parker Publishing Group Plc

Summary Profit and Loss Account

Audited for the year to March 31st 2007




    Revenue from main business, magazine publishing:        228

    Revenue from other activities:                            17

    Total turnover:                                          245



    Pay and other employee costs:                            69

    Depreciation of fixed assets:                              3

    Selling and marketing costs:                              38

    Other operational costs:                                  61

    Total operating costs:                                     171



    Operating profit:                                          157

    Profit from sale of fixed assets:                               6

    Net interest payable:                                        2

    Profit before tax:                                          149

    Tax:                                                      32

    Profit after tax:                                            117

    Shareholder dividends:                                     55

    Profit retained in the business                               62


    Earnings per share                                          17.4p


A.     Match the words from the accounts summary with the definitions.

1. Audited         e. accounts checked by an independent examiner

2. Revenue         d. after any deductions

3. Turnover         h. total income

4. Fixed asset       c. asset purchased for long-term use, such as land, buildings and equipment

5. Depreciation      a. reduction in value of an asset over time

6. Net               g. income

7. Shareholder       f. a person who has invested in the company through buying shares

8. Dividend           b. money paid to shareholders


1. Turnover is income after outgoings have been deducted.             True/false

2. Salaries and wages were the only major operating cost.              True/false

3. Depreciation of fixed assets seriously reduced operating profits.      True/false

4. Parker Publishing spent a lot on sales and marketing.               True/false

5. The company sold some assets.                                     True/false

6. Nearly all the profits went to the shareholders.                      True/false

7. Dividends were only 17.4p per shareholder.                          True/false

8. It was a very bad year for Parker Publishing.                        True/false


1.      The year to March 31st can also be called the year _________ March 31st.

A. finishing                    b. ending                          c. terminating

2. Another term for “main business” is _________ business.

A. central                      b. first                            c. core

3. A company which makes a profit can be described as profitable or _________.

A. profit-getting                b. profit-making                   c. profit-having

4. A company which makes a loss can be described as_________ .

A. loss-getting                  b. loss-making                    c. loss-having

5. “Profit before tax” can also be called _________.

A. pre-tax profit                b. without-tax profit               c. non-tax profit

6. Another word for shareholders (especially in American English) is _________.

A. ticket-holders                b. stockholders                    c. paper-holder

7. Another word for “operating costs” is _________.

a. overheads                    b. headings                       c. heads

8. A company which makes neither a profit nor a loss is said to _________.

A. fall even                     b. drop even                       c. break even

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