Chapter 5, Problem 24Q

To determine

Gross profit rate is the financial ratio that shows the relationship between the gross profit and net sales. Gross profit is the difference between the total revenues and cost of goods sold. It is calculated by using the following formula:

$\text{Gross profit rate}=\frac{\text{Gross profit}}{\text{Net sales}}\times 100$

To Consider: The other factors that are to be taken by the company, before reducing the selling price by 15%.