Fundamentals of Financial Accounting
5th Edition
ISBN: 9780078025914
Author: Fred Phillips Associate Professor, Robert Libby, Patricia Libby
Publisher: McGraw-Hill Education
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Chapter 13, Problem 13.6ME
To determine
To Calculate: the gross profit percentage.
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A consumer products company reported a 25 percent increase in sales from last year to this year.Sales last year were $200,000. This year, the company reported Cost of Goods Sold in the amountof $150,000. What was the gross profit percentage this year? Round to one decimal place.
Assume the following sales data for a company:
Line Item Description
Amount
Current year
$891,303
Preceding year
515,759
What is the percentage increase in sales from the preceding year to the current year?
Use the following information to determine the Prior Year and Current Year trend percents for net sales using the Prior Year as the base year. (Enter the answers in thousands of dollars.)
($ thousands)
CurrentYear
PriorYear
Net sales
$
453,100
$
230,000
Cost of goods sold
222,019
68,080
Trend Percent for Net Sales:
Choose Numerator:
/
Choose Denominator:
/
=
Trend Percent
Current Year:
/
=
%
Prior Year:
/
=
%
Chapter 13 Solutions
Fundamentals of Financial Accounting
Ch. 13 - What is the general goal of trend analysis?Ch. 13 - Prob. 2QCh. 13 - What is ratio analysis? Why is it useful?Ch. 13 - What benchmarks are commonly used for interpreting...Ch. 13 - Prob. 5QCh. 13 - Prob. 6QCh. 13 - Slow Cellars current ratio increased from 1.2 to...Ch. 13 - From last year to this year, Colossal Companys...Ch. 13 - From last year to this year, Berry Bam reported...Ch. 13 - Explain whether the following situations, taken...
Ch. 13 - What are the two essential characteristics of...Ch. 13 - Prob. 12QCh. 13 - Prob. 13QCh. 13 - Prob. 14QCh. 13 - Prob. 15QCh. 13 - Prob. 16QCh. 13 - 1. Which of the following ratios is not used to...Ch. 13 - Prob. 2MCCh. 13 - Prob. 3MCCh. 13 - Analysts use ratios to a. Compare different...Ch. 13 - Which of the following ratios incorporates stock...Ch. 13 - Prob. 6MCCh. 13 - Prob. 7MCCh. 13 - A bank is least likely to use which of the...Ch. 13 - Prob. 9MCCh. 13 - (Supplement 13A) Which of the following items is...Ch. 13 - Calculations for Horizontal Analyses Using the...Ch. 13 - Calculations for Vertical Analyses Refer to M13-1....Ch. 13 - Interpreting Horizontal Analyses Refer to the...Ch. 13 - Interpreting Vertical Analyses Refer to the...Ch. 13 - Prob. 13.5MECh. 13 - Prob. 13.6MECh. 13 - Prob. 13.7MECh. 13 - Analyzing the Inventory Turnover Ratio A...Ch. 13 - Inferring Financial Information Using the Current...Ch. 13 - Prob. 13.10MECh. 13 - Identifying Relevant Ratios Identify the ratio...Ch. 13 - Prob. 13.12MECh. 13 - Analyzing the Impact of Accounting Alternatives...Ch. 13 - Describing the Effect of Accounting Decisions on...Ch. 13 - Prob. 13.1ECh. 13 - Prob. 13.2ECh. 13 - Prob. 13.3ECh. 13 - Computing Profitability Ratios Use the information...Ch. 13 - Prob. 13.5ECh. 13 - Matching Each Ratio with Its Computational Formula...Ch. 13 - Computing and Interpreting Selected Liquidity...Ch. 13 - Prob. 13.8ECh. 13 - Prob. 13.9ECh. 13 - Prob. 13.10ECh. 13 - Prob. 13.11ECh. 13 - Prob. 13.12ECh. 13 - Prob. 13.13ECh. 13 - Prob. 13.14ECh. 13 - Analyzing the Impact of Alternative Inventory...Ch. 13 - Prob. 13.1CPCh. 13 - Analyzing Comparative Financial Statements Using...Ch. 13 - Prob. 13.3CPCh. 13 - Prob. 13.4CPCh. 13 - Prob. 13.5CPCh. 13 - Prob. 13.6CPCh. 13 - Prob. 13.7CPCh. 13 - Prob. 13.1PACh. 13 - Analyzing Comparative Financial Statements Using...Ch. 13 - Prob. 13.3PACh. 13 - Prob. 13.4PACh. 13 - Interpreting Profitability, Liquidity, Solvency,...Ch. 13 - Using Ratios to Compare Loan Requests from Two...Ch. 13 - Prob. 13.7PACh. 13 - Prob. 13.1PBCh. 13 - Prob. 13.2PBCh. 13 - Prob. 13.3PBCh. 13 - Prob. 13.4PBCh. 13 - Interpreting Profitability, Liquidity, Solvency,...Ch. 13 - Using Ratios to Compare Loan Requests from Two...Ch. 13 - Prob. 13.7PBCh. 13 - Prob. 13.1SDCCh. 13 - Prob. 13.2SDCCh. 13 - Prob. 13.5SDCCh. 13 - Prob. 13.6SDCCh. 13 - Prob. 13.7SDCCh. 13 - Prob. 13.1CC
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- Working Backward: Gross Profit Ratio Acmes gross profit ratio increased by 20% over the prior year. Net sales and cost of goods sold for the prior year were $120,000 and $90,000, respectively. Cost of goods sold for the current year is $140,000. Required Determine the amount of Acmes sales for the current year.arrow_forwardThe following information is available for Cooke Company for the current year: The gross margin is 40% of net sales. What is the cost of goods available for sale? a. 5840,000 b. 960,000 c. 1,200,000 d. 1,220,000arrow_forwardRevenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current Year Previous Year Sales $488,000 $415,000 Cost of goods sold 312,320 232,400 Selling expenses 68,320 74,700 Administrative expenses 78,080 62,250 Income tax expense 9,760 16,600 a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers.arrow_forward
- b. The vertical analysis indicates that the cost of goods sold as a percent of sales by 8 percentage points, while selling expenses - by 4 percentage points, and administrative expenses by 1 percentage points. Thus, net income as a percent of sales by 3 percentage points.arrow_forwardAssume the following sales data for a company. Current year $738,274 Preceding year $642,971 What is the percentage increase in sales from the preceding year to the current year? A. 12.91 B. 114.82 C. 87.09 D.14.82arrow_forwardCommon-size and trend percents for Roxi Company’s sales, cost of goods sold, and expenses follow. Determine whether net income increased, decreased, or remained unchanged in this three-year period.arrow_forward
- Vertical Analysis of Income Statement Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current Year Previous Year Sales Cost of merchandise sold Selling expenses Administrative expenses Income tax expense Sales a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers. Innovation Quarter Inc. Comparative Income Statement For the Years Ended December 31 Current year Amount Current year Percent $388,000 100 248,320 Cost of merchandise sold Gross profit Selling expenses Administrative expenses Total operating expenses Income from operations Income tax expense $388,000 248,320 54,320 62,080 7,760 Net income $353,000 208,270 56,480 52,950 14,120 $ 54,320 62,080 7,760 % % % % % % % % % Previous year Amount Previous year Percent $353,000 100 ✓ % 208,270 $ 56,480 52,950 14,120 % % % % % % % %arrow_forwardVertical Analysis of Income Statement Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current Year Previous Year Sales $457,000 $407,000 Cost of goods sold 283,340 231,990 Selling expenses 68,550 69,190 Administrative expenses 77,690 65,120 Income tax expense 9,140 16,280 a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers. Innovation Quarter Inc. Comparative Income Statement For the Years Ended December 31 Current year Amount Current year Percent Previous year Amount Previous year Percent Sales $457,000 % $407,000 % Cost of goods sold 283,340 231,990 % % % Selling expenses 68,550 % 69,190 Administrative expenses 77,690 % 65,120 % % % % % Income tax expense 9,140 % 16,280 % % % b. The vertical analysis indicates that the cost of goods sold as a percent of sales by 5 percentage points, while selling…arrow_forwardVertical Analysis of Income Statement Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Previous Year Sales Cost of goods sold Selling expenses Administrative expenses Income tax expense Current Year $447,000 272,670 71,520 71,520 13,410 $384,000 215,040 69,120 57,600 15,360arrow_forward
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