Profit margin ratio: Profit margin ratio represents the profitability of the given product. Gross Margin ratio: Gross margin ratio measures the degree of profit earned by company by selling its inventory. To identify: Change in ratio to be classified under favorable and unfavorable.

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Chapter 4, Problem 13E

To determine

Profit margin ratio:

Profit margin ratio represents the profitability of the given product.

Gross Margin ratio:

Gross margin ratio measures the degree of profit earned by company by selling its inventory.

To identify: Change in ratio to be classified under favorable and unfavorable.

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