Put the sales revenue growth figure that you worked out in step 2 in the last column, and compare this with the profit growth. Companies have to be careful to keep costs under control. Any excessive increase in costs will obviously damage their profitability. The Extel data doesn t give us the figure for the company s overheads, but we can work it out by deduction. To check your understanding of the different types of costs, try to classify the costs in the table below as either direct or indirect and put a tick in the appropriate column.
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