Page 276 - Cambridge IGCSE Business Studies
P. 276
Cambridge IGCSE Business Studies Section 5 Financial information and decisions
CASE STUDY Uchumi
Uchumi’s pre-tax profi t drops
Uchumi is Kenya’s second largest retail In October 2012, the company announced
chain with stores in neighbouring Uganda it was opening at least eight new branches
and Tanzania. Its pre-tax profi t fell in the east Africa region by 2014.
35.4% in the half-year ending December
2012 due to lower revenue and higher
operating costs.
274
A Uchumi store in Kenya
Source: Adapted from http://kenya.uchumicorporate.co.ke
TASK
a What is meant by ‘profit’?
b Identify two reasons for the fall in Uchumi’s half-yearly profits.
c Identify and explain three reasons why profit is important to Uchumi.
TEST YOURSELF
1 Explain the difference between gross profit and profit.
2 Exp lain the purpose of the appropriation account on an income statement.
3 W hat is meant by dividends?
