Answered: 8. The difference between total sales…

8. The difference between total sales in dollars and total cost of goods sold is called: A. net operating income. B. net profit. C. the gross margin. D. the contribution margin.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter18: Pricing And Profitability Analysis

Section: Chapter Questions

Problem 3DQ: How do you calculate the markup on cost of goods sold? Is the markup pure profit? Explain.

See similar textbooks

Related questions

Q: Weighted average cost per unit = per unit. Cost Cost of Goods Allocation Cost of Goods Sold Ending…

A: Sales = (50 units x $120) + (25 units x $125) = $6000 + $3125 = $9125 Cost of Goods Available = (100…

Q: a. Net sales b. Cost of goods sold C. Gross profit on sales

A: Hi, there, Thanks for posting the question. As per our Q&A honour code, we must answer the first…

Q: What is operating margin ? a) It is equal to ( gross profit on sales – operating expense ) / net…

A: Operating Margin is the profitability ratio which shows the percentage of profit earned by the…

Q: Under the gross profit method, if the gross profit rate is based on cost, the cost of sales is…

A: The gross profit method is the one wherein the amount of inventory is measured using the gross…

Q: How to calculate the gross profit for merchandise business? A. Total Sales minus all the operating…

A: The Gross profit is the excess of revenue over the cost of goods sold. It is the amount available…

Q: 1. Indicate the effects on gross profit the changes in volume, unit selling price, and unit cost.…

A: Gross profit is calculated by reducing the cost of goods sold from sales revenue. Thus, sales price…

Q: Contrast the income statement effect of LIFO versus FIFO(on Cost of Goods Sold and Gross Profit)…

A: Last-in-First-Out (LIFO): In this method, items purchased recently are sold first. So, the value of…

Q: calculate gross profit using FIFO and weighted average

A: FIFO and weighted average are methods of valuation of inventory. FIFO means First - in -First out,…

Q: Net Sales Revenue: Variable Cost of Goods Sold: Fixed Cost of Goods Sold: Variable Selling and…

A: Absorption costing considers all costs of manufacturing as product costs irrespective of the nature…

Q: Total goods available for sale is equal to a. the sum of ending inventory and net purchases. b.…

A: Beginning inventory + Net purchases = Cost of goods sold + Ending inventory Total cost of goods…

Q: The base used in estimating the Allowance for uncollectible is a. Percentage of Gross Profit b.…

A: The allowance for uncollectible accounts is prepared to estimate and record bad debt expense for the…

Q: Which of the following is the correct computation for the cost of goods available for sale? a.Net…

A: Financial accounting: Financial accounting is the process of recording, summarizing, and reporting…

Q: Using Average - perpetual, how much is the cost of ending inventory per unit? Using Average -…

A: Under average cost method of inventory, average cost per unit of inventory is used for calculation…

Q: Gross profit is the difference between: Select one: a. revenues and expenses. b. net income and…

A: Gross profit is the company's profit after deducting the unit cost of goods from sales. Gross profit…

Q: The dollar amount of sales needed to achieve a target operating income is computed by…

A: The contribution margin is calculated as excess of sales revenue over variable expenses.

Q: What is Gross Margin? a) (Net Sales - Cost of Sales – Operating Expenses) / Net Sales b)…

A: Solution:- Introduction;- Gross margin is the difference between Net sales and cost of goods sold.…

Q: Calculate the profitability ratio which includes gross profit margin, operating profit margin, net…

A: Profitability Ratio: It measures the ability of company to generate profit from its operations or…

Q: Problem 10 Indicate the effects of the following errors on cost of goods sold and net income.

A: Cost of Goods sold = Opening stock + Purchases - Closing stock Net income = Sales - Cost of goods…

Q: 1. What is the controllable margin of each product? 2. What is the segment margin ofeach product? 3.…

A: The income statement can be prepared in many ways according to the determination of the net income.…

Q: 1. Prepare a table indicating contribution margin, variable cost of goods sold as a percent of…

A: Contribution Margin = Sales Price - Variable Costs Variable Cost of Goods Sold as a Percent of Sales…

Q: Which of the following is equal to the cost of goods sold? a. net purchases plus the excess of…

A: The question is related to cost of goods sold. The cost of goods sold is calculated with the help of…

Q: Calculate cost of goods sold using: 1) FIFO 2) Weighted-average cost || 3) LIFO

A: FIFO Method:

Q: On a traditional income statement, sales revenue less cost of goods sold equals Question 26…

A: The income statement is prepared to find net income or losses incurred during the period.

Q: Relative to the above data, how much is the Cost of sales and Net income for the period

A: The cost of goods sold is the cost of purchases and manufacturing of the products which the company…

Q: Gross profit from sales is the difference between

A: Gross profit means the excess of revenue against the cost of good sold from the operating activity…

Q: Calculate each of the following 1-Net sales -Cost of goods available for sales 3-Gross profit 4-Net…

A: Solution 1- Net Assets= Total sales- Sales return ( return inwards) = 100000-…

Q: 1. Gross profit margin is impacted by sales and cost of goods sold changes." O A) True O B) False

A: “Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only…

Q: The sales price for a product provides a gross profit of 14% of sales price. What is the gross…

A: Gross profit: It can be defined as the excess of a company's sales revenue over the direct expenses…

Q: 1. The amount by which an item contributes towards covering fixed cost and providing for profit is…

Q: Concept introduction Gross profit ratio: Gross profit ratio calculated by dividng the gross profit…

A: Cost of goods sold means cost incurred on goods or cost of goods that are being offered for sale to…

Q: The difference between Net sales and Cost of goods sold is referred as _____________.

A: Net Sales means Sales revenue less any sales return, discount and allowances whereas cost of Goods…

Q: What is the term applied to the excess of revenue from sales over the Cost of Merchandise Sold? a.…

A: Revenue from sales represents the amount of revenue recognized from the sales made during a…

Q: The gross profit rate is equal to: Choose net income divided by sales. cost of goods sold divided by…

A: Income statement is a part of financial statements of a company. It shows the company’s income and…

Q: A mark up of 15% on sales is equivalent to what markup on cost?

A: Suppose Sales = $100 Markup = 15% of Sales Markup = $15 So the Cost will be $85

Q: The difference between total sales in dollars and total variable expenses is called: a. net profit…

A: Contribution Margin Contribution Margin is the amount of revenue remaining after variable costs to…

Q: A component of operating efficiency and profitability, calculated by expressing net profit as a…

A: Profit is the amount earned by an entity after deducting all the outlays from the revenues.

Q: Compute the following: a) Net sales revenue b) Cost of goods sold

A: Gross profit is the amount earned from selling the company's products or rendering services. It is…

Q: 7. Consider the following: Code: A= Gross Profit to Net Sales Ratio B= Gross Profit to Cost of Goods…

A: Gross profit ratio can be calculated on the basis of net sales ratio or cost of goods sold ratio.

Q: The contribution margin ratio is equal to: total manufacturing expenses / sales. contribution margin…

A: Contribution margin: Difference between the sales and the variable costs is called contribution…

Q: Gross profit is: The amount left over after cost of goods sold is subtracted from net sales. A.Net…

A: Introduction:- Income statement shows company's income and expenses over a period of time.…

Q: Conversion cost during the period? Cost of goods available for sales? Cost of goods sold?

A: Hi student Since there are multiple subparts, we will answer only first three subparts

Q: Gross profit variance analysis can be used to study the effect of: a. Changes in cost of goods…

A: Gross profit is the gross income/revenue left after deducting the cost of goods sold from the net…

Q: Compute the gross margin for FIFO method and LIF0 method. FIFO: LIFO: Sales revenue Less: Cost of…

A: Sales revenue has to be calculated by multiplying units sold (785 units) to the retail rate…

Q: An analyst is constructing a simple model to determine the gross and net profit of a product, given…

A: Gross profit means the difference between the sale revenue and cost of goods sold where as net…

Question

8. The difference between total sales in dollars and total cost of goods sold is called:
A. net operating income.
B. net profit.
C. the gross margin.
D. the contribution margin.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

The difference between total sales in dollars and total variable expenses is called: a. net profit b. net operating income c. the gross margin O d. the contribution margin
1. The amount by which an item contributes towards covering fixed cost and providing for profit is known as: a. gross profit b. gross margin c. contribution margin d. net margin
Solomon Manufacturing Company was started on January 1, year 1, when it acquired $83,000 cash by issuing common stock. Solomon immediately purchased office furniture and manufacturing equipment costing $7,000 and $ 27,600, respectively. The office furniture had an eight-year useful life and a zero salvage value. The manufacturing equipment had a $3,900 salvage value and an expected useful life of three years. The company paid $11, 100 for salaries of administrative personnel and $15, 600 for wages to production personnel. Finally, the company paid $10, 380 for raw materials that were used to make inventory. All inventory was started and completed during the year. Solomon completed production on 4, 400 units of product and sold 3,490 units at a price of $15 each in year 1. (Assume that all transactions are cash transactions and that product costs are computed in accordance with GAAP.)
The difference between sales and marginal cost is______________ a. Fixed Cost b. Profit c. Sales price d. Contribution
9. The point where the sales line and the total expense line intersects represents the A. profit point. B. contribution point. C. breakeven point. D. margin point.
Which of the following statements correctly complete the sentence:"Gross Margin equals":I. sales revenue less (minus) cost of goods sold.II. contribution margin less (minus) fixed costs.III. operating income plus all period costs.IV. sales revenue less (minus) cost of goods manufactured.
The of each product's sales to. O selling price, profit O unit price, expense O ratio, total sales O profit, revenue yields the sales mix.
Which of the following ratios indicates the percentage of each sales dollar that is available to cover fixed costs and to provide a profit? a. costs and expenses ratio b. contribution margin ratio c. margin of safety ratio d. profit ratio
Contrast the income statement effect of LIFO versus FIFO(on Cost of Goods Sold and Gross Profit) when ( a ) costsare rising and ( b ) costs are falling.
Question 4: The difference between total sales revenue and total cost of goods sold is the Group of answer choices a Net marketing contribution b Gross marketing contribution c All of these d Trade margin
Revenue minus all direct costing of making the goods or supplying the service is known as?a. Gross profitb. Cost of salesc. Expensesd. Net profit
On a traditional income statement, sales revenue less cost of goods sold equals Question 26 options: operating income. operating expenses. contribution margin. gross profit.