1.
Concept introduction:
Gross profit ratio: Gross profit ratio is a very useful financial ratio that is used to find the efficiency of the company and is computed by dividing gross profit from its sales revenue.
To Compute: The gross profit ratio for both the years current as well as the previous year.
2.
Concept introduction:
Gross profit ratio: Gross profit ratio is a very useful financial ratio that is used to find the efficiency of the company and is computed by dividing gross profit from its sales revenue.
The outperform or underperform as compared to the industry in the current year.
3.
Concept introduction:
Gross profit ratio: Gross profit ratio is a very useful financial ratio that is used to find the efficiency of the company and is computed by dividing gross profit from its sales revenue.
The improvement in gross profit ratio in the current year as compared to the previous year.
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- Cuneo Companys income statements for the last 3 years are as follows: Refer to the information for Cuneo Company above. Required: 1. Prepare a common-size income statement for Year 1 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.) 2. Prepare a common-size income statement for Year 2 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.) 3. Prepare a common-size income statement for Year 3 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.)arrow_forwardApple Inc.: Segment revenue analysis Segment disclosure by Apple Inc. provides sales information for its major product lines for three recent years as follows (in millions): A. Which product had the greatest percentage of Year 3 sales? Which product had the least percentage of Year 3 sales? (Round to nearest whole percent.) B. Which product grew the most in sales, in percentage terms, using Year 1 as the base year? (Round to nearest whole percent.)arrow_forwardJuroe Company provided the following income statement for last year: Juroes balance sheet as of December 31 last year showed total liabilities of 10,250,000, total equity of 6,150,000, and total assets of 16,400,000. Required: 1. Calculate the return on sales. (Note: Round the percent to two decimal places.) 2. CONCEPTUAL CONNECTION Briefly explain the meaning of the return on sales ratio, and comment on whether Juroes return on sales ratio appears appropriate.arrow_forward
- Assume the following sales data for a company: Current year $896,005 Preceding year 607,844 What is the percentage increase in sales from the preceding year to the current year (rounded to one decimal place)? Oa. 47.4% Ob. 15.3% Oc. 32.2% Od. 79.6%arrow_forwardAssume the following sales data for a company: Line Item Description Amount Current year $891,303 Preceding year 515,759 What is the percentage increase in sales from the preceding year to the current year?arrow_forwardCommon-Sized Income Statement Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhill's data are expressed in dollars. The electronics industry averages are expressed in percentages. Electronics Tannenhill Industry Company Average Sales $820,000 100 % Cost of goods sold 524,800 70 Gross profit $295,200 30 % Selling expenses $180,400 17 % Administrative expenses 65,600 7 Total operating expenses $246,000 24 % Operating income $49,200 6 % Other revenue 16,400 2 $65,600 8 % Other expense 8,200 1 Income before income tax $57,400 7 % Income tax expense 24,600 4 Net income $32,800 3 %arrow_forward
- take&inprogress=false Assume the following sales data for a company: Current year $718,386 Preceding year 639,310 What is the percentage increase in sales from the preceding year to the current year (rounded to one decimal place)? O a. 23.4% Ob. 1.4% O c. 12.4% O d. 11.0%arrow_forward14- Gross profit of a firm for an accounting year is calculated by using __________ formula while preparing income statement. a. All of the options b. Net sales – Sales return c. Net sales – Cost of goods sold d. Net sales – Expensesarrow_forwardIncome statement data for Winthrop Company for two recent years ended December 31, are as follows: Current Year Previous Year Sales $369,600 $280,000 Cost of goods sold 312,000 240,000 Gross profit $57,600 $40,000 Selling expenses $17,080 $14,000 Administrative expenses 15,600 12,000 Total operating expenses $32,680 $26,000 Income before income tax $24,920 $14,000 Income tax expenses 10,000 5,600 Net income $14,920 $8,400 a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. If required, round to one decimal place. Winthrop Company Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year year (Decrease) (Decrease) Amount Amount Amount Percent Sales $369,600 $280,000 $ % Cost of goods sold 312,000 240,000 % Gross profit $57,600 $40,000 %arrow_forward
- Common-size and trend percents for Roxi Company's sales, cost of goods sold, and expenses follow. Current Year Sales Cost of goods sold Operating expenses Common-Size Percents 1 Year Ago 100.0% 63.2 14.2 Trend Percents 2 Years Ago 100.0% 61.0 13.7 Determine the net income for the following years. Did the net income increase, decrease, or remain unchanged in this three-year period? Current Year 100.0% 57.6 14.0 1 Year Years Ago Ago 103.9% 102.7% 108.8 114.0 105.4 100.5 100.0 100.0 100.0arrow_forwardQuestion 1 Indicate which one of the following would not appear on both a single-step income statement and a multiple-step income statement. Question 2 Bolton Company’s gross profit rate last year was 32.0% and this year it is 28.4%. Which of the following would not be a possible cause for this decline in the gross profit rate? Question 3 The amount of cost of good available for sale during the year depends on the amounts of Question 4 The Sales Returns and Allowances account does not provide information to management about Question 5 Stan’s Market recorded the following events involving a recent purchase of merchandise: As a result of these events, the company’s merchandise inventory Question 6 Gross profit equals the difference between sales and Question 7 A company using a perpetual inventory system that returns goods previously purchased on credit would Question 8 The collection of a $900 account beyond the 2 percent discount period will result in a Question 9 Expenses…arrow_forwardCommon-Sized Income Statement Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhill's data are expressed in dollars. The electronics industry averages are expressed in percentages. Electronics Tannenhill Industry Company Average Sales $2,580,000 100 % Cost of merchandise sold 1,728,600 71 Gross profit $851,400 29 % Selling expenses $490,200 16 % Administrative expenses 206,400 7 Total operating expenses $696,600 23 % Income from operations $154,800 6 % Other revenue and expense: Other revenue 51,600 Other expense (25,800) Income before income tax expense $180,600 7 % Income tax expense 77,400 4 Net income $103,200 3 %arrow_forward
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