Net Sales: It is the amount of sales of a company which comes after reducing sales returns and allowances, sales discount. Gross margin ratio: It means the ratio of gross profit earned to net sales. Formula to compute it: Gross Margin Ratio = Gross Profit Net Sales Gross margin: It means the amount of profit which is computed after deducting Cost of goods sold from Net sales. Gross margin = Net sales − Cost of goods sold 1. To Compute: Gross margin and Gross margin ratio for two years.

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Answer 1

Question

Chapter 4, Problem 2BTN

To determine

Net Sales:

It is the amount of sales of a company which comes after reducing sales returns and allowances, sales discount.

Gross margin ratio:

It means the ratio of gross profit earned to net sales. Formula to compute it:

Gross Margin Ratio=Gross ProfitNet Sales

Gross margin:

It means the amount of profit which is computed after deducting Cost of goods sold from Net sales.

Gross margin=Net sales−Cost of goods sold

1.

To Compute: Gross margin and Gross margin ratio for two years.

2.

To determine

To Identify: Company earning more gross margin and having better ratio in comparison to industry average.

3.

To determine

To Identify: Gross margin ratio improved or declined.3

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Answer 2

Question

Chapter 4, Problem 2BTN

To determine

Net Sales:

It is the amount of sales of a company which comes after reducing sales returns and allowances, sales discount.

Gross margin ratio:

It means the ratio of gross profit earned to net sales. Formula to compute it:

Gross Margin Ratio=Gross ProfitNet Sales

Gross margin:

It means the amount of profit which is computed after deducting Cost of goods sold from Net sales.

Gross margin=Net sales−Cost of goods sold

1.

To Compute: Gross margin and Gross margin ratio for two years.

2.

To determine

To Identify: Company earning more gross margin and having better ratio in comparison to industry average.

3.

To determine

To Identify: Gross margin ratio improved or declined.3

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 4, Problem 2BTN

To determine

Net Sales:

It is the amount of sales of a company which comes after reducing sales returns and allowances, sales discount.

Gross margin ratio:

It means the ratio of gross profit earned to net sales. Formula to compute it:

Gross Margin Ratio=Gross ProfitNet Sales

Gross margin:

It means the amount of profit which is computed after deducting Cost of goods sold from Net sales.

Gross margin=Net sales−Cost of goods sold

1.

To Compute: Gross margin and Gross margin ratio for two years.

2.

To determine

To Identify: Company earning more gross margin and having better ratio in comparison to industry average.

3.

To determine

To Identify: Gross margin ratio improved or declined.3

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 4, Problem 2BTN

To determine

Net Sales:

It is the amount of sales of a company which comes after reducing sales returns and allowances, sales discount.

Gross margin ratio:

It means the ratio of gross profit earned to net sales. Formula to compute it:

Gross Margin Ratio=Gross ProfitNet Sales

Gross margin:

It means the amount of profit which is computed after deducting Cost of goods sold from Net sales.

Gross margin=Net sales−Cost of goods sold

1.

To Compute: Gross margin and Gross margin ratio for two years.

2.

To determine

To Identify: Company earning more gross margin and having better ratio in comparison to industry average.

3.

To determine

To Identify: Gross margin ratio improved or declined.3

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 5

Chapter 4, Problem 2BTN

To determine

Net Sales:

It is the amount of sales of a company which comes after reducing sales returns and allowances, sales discount.

Gross margin ratio:

It means the ratio of gross profit earned to net sales. Formula to compute it:

Gross Margin Ratio=Gross ProfitNet Sales

Gross margin:

It means the amount of profit which is computed after deducting Cost of goods sold from Net sales.

Gross margin=Net sales−Cost of goods sold

1.

To Compute: Gross margin and Gross margin ratio for two years.

2.

To determine

To Identify: Company earning more gross margin and having better ratio in comparison to industry average.

3.

To determine

To Identify: Gross margin ratio improved or declined.3

Answer 6

Chapter 4, Problem 2BTN

To determine

Net Sales:

It is the amount of sales of a company which comes after reducing sales returns and allowances, sales discount.

Gross margin ratio:

It means the ratio of gross profit earned to net sales. Formula to compute it:

Gross Margin Ratio=Gross ProfitNet Sales

Gross margin:

It means the amount of profit which is computed after deducting Cost of goods sold from Net sales.

Gross margin=Net sales−Cost of goods sold

1.

To Compute: Gross margin and Gross margin ratio for two years.

Answer 7

Chapter 4, Problem 2BTN

To determine

Net Sales:

It is the amount of sales of a company which comes after reducing sales returns and allowances, sales discount.

Gross margin ratio:

It means the ratio of gross profit earned to net sales. Formula to compute it:

Gross Margin Ratio=Gross ProfitNet Sales

Gross margin:

It means the amount of profit which is computed after deducting Cost of goods sold from Net sales.

Gross margin=Net sales−Cost of goods sold

1.

To Compute: Gross margin and Gross margin ratio for two years.

Answer 8

2.

To determine

To Identify: Company earning more gross margin and having better ratio in comparison to industry average.

Answer 9

2.

To determine

To Identify: Company earning more gross margin and having better ratio in comparison to industry average.

Answer 10

3.

To determine

To Identify: Gross margin ratio improved or declined.3

Answer 11

3.

To determine

To Identify: Gross margin ratio improved or declined.3

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

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Answer 15

Ch. 4 - Prob. 1MCQ Ch. 4 - A company purchased $4,500 of merchandise on May 1...Ch. 4 - Prob. 3MCQ Ch. 4 - Prob. 4MCQ Ch. 4 - Prob. 5MCQ Ch. 4 - Prob. 1DQ Ch. 4 - Prob. 2DQ Ch. 4 - Prob. 3DQ Ch. 4 - Prob. 4DQ Ch. 4 - Prob. 5DQ

Solution Summary: The author explains Gross margin, which is the ratio of gross profit earned to net sales.

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To Identify: Company earning more gross margin and having better ratio in comparison to industry average.

To Identify: Gross margin ratio improved or declined.3

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