A. Calculate the gross profit margin for Pearson and litt for 2020 B. Explain the results of the gross margin profit calculation Consider the information provided below as well as the financial statements and answer thequestions that follow.Pearson & Litt is a manufacturing company in the Eastern Cape. Their factory manufactures glasswine bottles for the Blue Valley Beer Co.20192020Sales price per unitR15R19Variable cost per unitRGR7Fixed cost (FC) per annumR650 000R 855 500Fixed cost per unitR3R4Current assetsR450600R560 700Current liabilitiesR510000R780 000Retained profitR21 809R17600Net SalesR2 900 320R3100 100Cost of salesR390 000R475000

Gross profit is the profit generated after deducting direct expenses related to the goods from the…

Answered: A. Calculate the gross profit margin…

A. Calculate the gross profit margin for Pearson and litt for 2020 B. Explain the results of the gross margin profit calculation

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Gross profit margin Gross profit margin= Gross profit' revenue*100 Year Gross profit Revenue Gross…

A: Ratio analysis includes the comparison of the ratios with different companies and situations.

Q: esented here are summarized data from the balance sheets and income statements of Wiper Inc.:…

A: Ratio Analysis -Ratio Analysis is a important technique to analyze the two years of financials of…

Q: Sunland Manufacturing has provided the following comparative income statements for 2021 and 2022.…

A: Common Size Analysis is also known as Vertical analysis. Common Size analysis mainly refers to the…

Q: Analyse the Assets-to-equity ratio of 1.87 in 2019 and 1.67 in 2020

A: As per Bartleby Honor Code, when multiple questions are asked, the expert is required only to solve…

Q: Interpretation Operating cash flow ratio Working Capital

A: Solution Concept Mathematically ,we have Current ratio =current assets / current liabilities…

Q: current ratio,quick ratio and cash ratio and give recommendation

A: Ratio analysis is the way of analyzing the financial information based on certain metrics computed…

Q: Required: Compute the following: (For Requirements 1 to 4, enter your percentage answers rounded to…

A: As per Bartleby Honor Code, when a question with multiple sub-parts has been asked, the expert is…

Q: Projecting NOPAT and NOA Using Parsimonious Forecasting Method Following are Logitech's sales, net…

A: Step 1: Calculating NOPAT for 2020To calculate NOPAT for 2020 using the parsimonious forecasting…

Q: What the annual charge against profit will be: (ii) One way in which the statement of comprehensive…

A: The charge against profit is actually the provision for the something which a company have to make…

Q: explain each ratio of this list what happened in 2019, 2020, 2021? List of Ratios 2019 2020 2021…

A: Gross profit margin: Formula of Gross Profit Margin=(Sales Revenue - Cost of Sales)Sales Revenue*…

Q: How do you calculate net sales? Also... Do you only look at current year data or do you factor…

A: Net Sales=Gross Sales-Returns-Allowances-Discounts where, Gross sales=the total unadjusted sales of…

Q: Use Table 1 and the following information on Company X to perform a pro-forma financial modeling…

A: Forecasted financial statements refers to those financial statements which represent the predicted…

Q: Solve the following finance question. Q: Compute the following financial ratios by…

A: Ratio analysis is referred to as the quantitative method or technique, which used to gain an insight…

Q: What are the Profitability Ratios for the periods 2019,2020 and 2021? What is it's Financial…

A: Profit margin on Sales = Net Income / Sales Earning Power ratio = EBIT / Total Assets Return on…

Q: Which statement is correct?

A: A current ratio is one of the ratios used to assess the liquidity of the company. It shows that the…

Q: Solve the following ratios from year 2018-2020. Show complete solutions/computations. -OPERATING…

A: Ratio analysis: Ratio analysis is a tool that establishes a relationship between the different…

Q: Assume you are a financial analyst in an investment company, and you are required to analyse and…

A: Return on Equity Ratio: Return on equity implies the measurement of organization’s Income by using…

Q: Zevenue: Product Service Total revenue Cost of revenue: Product Service Total cost of revenue Gross…

A: The common size income statement is a financial statement in which data of 2- 3 years are presented…

Q: hich of the following provides information about how many months of living expenses you can cover…

A: Just like companies we also use financial ratios for a person to determine the state of financial…

Q: Part D of this question asks what the gross profit would be for each plan. I am having trouble…

A: Gross profit is the income earned from an activity after deducting all the direct expenses from…

Q: Prepare a multiple income statement fro 2019

A: Multiple-step income statement shows net income of the company.

Q: Selected comparative financial statements of Korbin Company follow. Comparative Income Statements…

A: Current Ratio :— It is the ratio of current assets to current liabilities. Common size…

Q: a. Prepare a comparative income statement with horizontal analysis, indicating the increase…

A: Horizontal Analysis Horizontal analysis refers to the measurement of percentage change in the…

Q: The image uploaded is the calculation of Socite Generale Bank, Ghana, Profitability ratios, shorter…

A: The study or analysis of the line items included in the company's financial statements is known as…

Q: I need to prepare a compartive income statement for 2 yrs in vertical form. HOw do i calculate the…

A: Vertical analysis: The comparison of an item of a financial statement against the total amount of…

Q: Interest Coverage Ratio Return on asset Return on equity

A: Solution Concept Mathematically ,we have Interest coverage ratio =EBIT / interest expense Return on…

Q: Compute the gross profit under each plan

A: This is a follow-up question. we need to compute the gross profit of each plan. The financial data…

Q: On January 1, 2020, Beckham acquired a 2,000,000, 5 year bond, 10% bond for 2,169,329. Transaction…

A: FVPL (fair value through profit or loss) is the default treatment for investments where transaction…

Q: Income statement and balance sheet data for The Athletic Attic are provided below.Required: 1.…

A: Hey, since there are multiple questions posted, we will answer first question. If you want any…

Q: On May 1, Sandhill Company had 410 units of inventory on hand, at a cost of $4.00 each. The company…

A: Note: Assume FIFO method is used In order to determine the gross profit, the cost of products sold…

Q: assets t receivable (net pries

A: Ratio analysis is a very effective tool in Accounting to analyse…

Q: Projecting NOPAT and NOA Using Parsimonious Forecasting Method Following are Logitech's sales, net…

A: To forecast Logitech's sales, NOPAT, and NOA for fiscal years ended March 31, 2020 through 2023…

Q: The image uploaded is the calculation of Societe Generale Profitability ratios, shorter liquidity…

A: The objective of the question is to evaluate the financial performance of Societe Generale by…

Q: Note: who asked us to solve the question told us that the solution to this question is according to…

A: A pro forma income statement is a projected income statement. Pro forma in this context means…

Q: interpret or compare its results from 2018 to 2019

Q: Determine the following measures for 2016, rounding to one decimal place: 1. Working capital 2.…

A: “Hey, since there are multiple requirements posted, we will answer first three. If you want any…

Q: 1) What is the assumption of cost structure? 2) Calculate contribution Margin

A: A company's overall expenses are comprised of both fixed and variable costs, and together they make…

Question

A. Calculate the gross profit margin for Pearson and litt for 2020

B. Explain the results of the gross margin profit calculation

Consider the information provided below as well as the financial statements and answer the
questions that follow.
Pearson & Litt is a manufacturing company in the Eastern Cape. Their factory manufactures glass
wine bottles for the Blue Valley Beer Co.
2019
2020
Sales price per unit
R15
R19
Variable cost per unit
RG
R7
Fixed cost (FC) per annum
R650 000
R 855 500
Fixed cost per unit
R3
R4
Current assets
R450600
R560 700
Current liabilities
R510000
R780 000
Retained profit
R21 809
R17600
Net Sales
R2 900 320
R3100 100
Cost of sales
R390 000
R475000

Expert Solution

This question has been solved!

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

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Question 51: In the vertical analysis of an income statement, what is the base (100%) figure? Answer: A. Total expenses B. Total revenues C. Total assets D. Net income
15. Using the information above calculate the net income/ profit, total assets,total debt, total equity,current assets and current liabilities for the year 2016 and choose the correct below
Name four items that would ot apper in the projected income statement
Hello! look at the attached images and answee the following points: (a) Calculate ratios for the year ended 31 December 2021 (showing your workings) for Primrose Plc, equivalent to those provided above. Return on year-end capital employed Net asset turnover Gross profit margin Net profit margin Current ratio Closing inventory holding period Trade receivables’ collection period viii. Trade payables’ payment period Dividend yield Dividend cover (b) Analyse the financial performance and position of Primrose Plc for the year ended 31 December 2021 compared to 31 December 2020. (c) Explain the uses and the general limitations of ratio analysis. Thank you a lot!
Analyze the Gross profit ratio and give you a report on the same in 2020 and|2019? Gross profit Gross profit ratio= x100 Net sales In 2019= (25,361,421 /63,161,098) x100 =0.401 x100 =40.153% In 2020= (26,796,019/ 63,441,144) x100 =0.422 x100 =42.237%
Problem 13-2A (Algo) Ratios, common-size statements, and trend percents LO P1, P2, P3 [The following information applies to the questions displayed below] Selected comparative financial statements of Korbin Company follow. KORBIN COMPANY Comparative Income Statements For Years Ended December 31 2021 2020 2019 Sales Cost of goods sold $ 402,346 $ 308,230 242,212 $ 213,900 194,493 136,896 Gross profit 160,134 113,737 77,004 Selling expenses 57,133 42,536 28,235 Administrative expenses 36,211 27,124 17,754 Total expenses 93,344 69,660 45,989 Income before taxes Income tax expense 66,790 44,077 31,015 12,423 9,036 6,296 Net income $ 54,367 $ 35,041 $ 24,719 KORBIN COMPANY Comparative Balance Sheets December 31 Assets Current assets Long-term investments Plant assets, net Total assets Current liabilities Liabilities and Equity Common stock Other paid-in capital Retained earnings Total liabilities and equity $ 180,932 2021 $ 63,959 116,973 0 2020 $ 42,808 800 106,691 $ 180,932 $ 150,299 $…
Base on this financial ratios, what are your conclusions and recommendations for the company
27-A prepare the following: GROSS PROFIT RATIO PROFIT MARGIN RETURN ON ASSETS EARNINGS PER SHARE CURRENT RATIO ACID TEST RATIO DEBT RATIO
Pasta Corporation acquired 75% of Sauce Company on January 1, 2020 for $566,250 cash. The fair value of the other 25% ownership interest is estimated to be $188,750. ADDITIONAL INFORMATION: On the date of acquisition: * The Book Value of Sauce Company's net identifiable assets was $652,000. * Sauce's Company's Plant Assets were undervalued by $75,000 (remaining life was estimated to be 5 years). * Sauce's Company's Inventories were overvalued by $9,000 (all sold by year end). * New Goodwill was determined to be $37,000. At year-end, it was determined that the New Goodwill was impaired by $5,800. * For 2020, Sauce reported net income of $146,500 and paid dividends of $26,000. Assume that Pasta Company uses the fully adjusted equity method to account for its Investment in Sauce.
Cop dog
The image uploaded is the calculation of Cal Bank's Profitability ratios, shorter liquidity ratios, long-term liquidity ratios, and investment ratios for 2020, 2021, 2022. A base year of 2019 was also added. Evaluate the financial performance by comparing the three (3) years' financial performance that is 2020, 2021, and 2022 I have provided in the table with the base year.