Revenue is the total income earned by an organization by selling goods or rendering services. Net income represents the revenue after the deduction of operating expenses from the gross profit. Its mathematical representation is as below: Net income = Gross profit − Operating expenses To Compute: The percentage change in total revenue, and in net income from 2013 to 2014 for Incorporation A.

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Answer 1

Question

Chapter 5, Problem 5.1EYCT

(a)

To determine

Revenue is the total income earned by an organization by selling goods or rendering services.

Net income represents the revenue after the deduction of operating expenses from the gross profit. Its mathematical representation is as below:

Net income=Gross profit−Operating expenses

To Compute: The percentage change in total revenue, and in net income from 2013 to 2014 for Incorporation A.

(b)

To determine

Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula:

Profit Margin=Net incomeNet sales×100

To Calculate: The profit margin for the year 2012, 2013, and 2014 of Incorporation A.

(c)

To determine

Gross profit rate is the financial ratio that evaluates the money left over out of the total revenues after deducting the cost of goods sold. Thus, it shows the relationship between the gross margin and net sales. It is calculated by using the following formula:

Gross profit rate=Gross profitNet sales×100

To Calculate: The gross profit rate for the year 2012, 2013, and 2014 of Incorporation A.

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Cost Pools Budgeted Costs Cost Driver Practical Capacity Budgeted Activity for S-101 Budgeted Activity for C-110 Setup activity 250000 Setup hours 5000 2500 2350 Packing and shipping 50000 Number of shipments 2000 1200 775 Inspection 30000 Number of batches 1000 250 700 Machining 750000 Units produced 150000 100000 40000 Purchase ordering 40000 Number of orders 300 50 110 1. Which Cost Pool is approximately 22 percent of the total budgeted costs? 2. What percentage of the total budgeted costs does Machining take up? 3. What is the percentage of the total budgeted costs taken up by the smallest Cost Pool? 4. Which Cost Pool has 1.25 percent slack? 5. Which Cost Pool has the highest percent slack? 6. In the Inspection Cost Pool, what is the amount of difference between budgeted costs and the budgeted activity for both products? 7. In how many cost pools is the S-101 manufacturing overhead (MO) greater than the C-110 manufacturing overhead (MO)? 8. In which Cost Pools is…

Financial statements for Askew Industries for 2024 are shown below (in thousands): 2024 Income Statement Net sales $ 8,600 Cost of goods sold (6,050) Gross profit 2,550 Operating expenses (1,850) Interest expense (100) Income tax expense (240) Net income $ 360 Comparative Balance Sheets December 31 2024 2023 Assets Cash $ 500 $ 400 Accounts receivable 500 300 Inventory 700 500 Property, plant, and equipment (net) 1,000 1,100 $ 2,700 $ 2,300 Liabilities and Shareholders’ Equity Current liabilities $ 500 $ 250 Bonds payable 900 900 Common stock 500 500 Retained earnings 800 650 $ 2,700 $ 2,300 Calculate the following ratios for 2024. Note: Consider 365 days a year. Round your intermediate calculations and final answers to 2 decimal places.

Answer 2

Question

Chapter 5, Problem 5.1EYCT

(a)

To determine

Revenue is the total income earned by an organization by selling goods or rendering services.

Net income represents the revenue after the deduction of operating expenses from the gross profit. Its mathematical representation is as below:

Net income=Gross profit−Operating expenses

To Compute: The percentage change in total revenue, and in net income from 2013 to 2014 for Incorporation A.

(b)

To determine

Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula:

Profit Margin=Net incomeNet sales×100

To Calculate: The profit margin for the year 2012, 2013, and 2014 of Incorporation A.

(c)

To determine

Gross profit rate is the financial ratio that evaluates the money left over out of the total revenues after deducting the cost of goods sold. Thus, it shows the relationship between the gross margin and net sales. It is calculated by using the following formula:

Gross profit rate=Gross profitNet sales×100

To Calculate: The gross profit rate for the year 2012, 2013, and 2014 of Incorporation A.

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Answer 3

Question

Chapter 5, Problem 5.1EYCT

(a)

To determine

Revenue is the total income earned by an organization by selling goods or rendering services.

Net income represents the revenue after the deduction of operating expenses from the gross profit. Its mathematical representation is as below:

Net income=Gross profit−Operating expenses

To Compute: The percentage change in total revenue, and in net income from 2013 to 2014 for Incorporation A.

(b)

To determine

Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula:

Profit Margin=Net incomeNet sales×100

To Calculate: The profit margin for the year 2012, 2013, and 2014 of Incorporation A.

(c)

To determine

Gross profit rate is the financial ratio that evaluates the money left over out of the total revenues after deducting the cost of goods sold. Thus, it shows the relationship between the gross margin and net sales. It is calculated by using the following formula:

Gross profit rate=Gross profitNet sales×100

To Calculate: The gross profit rate for the year 2012, 2013, and 2014 of Incorporation A.

Expert Solution & Answer

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Answer 4

Question

Chapter 5, Problem 5.1EYCT

(a)

To determine

Revenue is the total income earned by an organization by selling goods or rendering services.

Net income represents the revenue after the deduction of operating expenses from the gross profit. Its mathematical representation is as below:

Net income=Gross profit−Operating expenses

To Compute: The percentage change in total revenue, and in net income from 2013 to 2014 for Incorporation A.

(b)

To determine

Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula:

Profit Margin=Net incomeNet sales×100

To Calculate: The profit margin for the year 2012, 2013, and 2014 of Incorporation A.

(c)

To determine

Gross profit rate is the financial ratio that evaluates the money left over out of the total revenues after deducting the cost of goods sold. Thus, it shows the relationship between the gross margin and net sales. It is calculated by using the following formula:

Gross profit rate=Gross profitNet sales×100

To Calculate: The gross profit rate for the year 2012, 2013, and 2014 of Incorporation A.

Expert Solution & Answer

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Answer 5

Chapter 5, Problem 5.1EYCT

(a)

To determine

Revenue is the total income earned by an organization by selling goods or rendering services.

Net income represents the revenue after the deduction of operating expenses from the gross profit. Its mathematical representation is as below:

Net income=Gross profit−Operating expenses

To Compute: The percentage change in total revenue, and in net income from 2013 to 2014 for Incorporation A.

(b)

To determine

Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula:

Profit Margin=Net incomeNet sales×100

To Calculate: The profit margin for the year 2012, 2013, and 2014 of Incorporation A.

(c)

To determine

Gross profit rate is the financial ratio that evaluates the money left over out of the total revenues after deducting the cost of goods sold. Thus, it shows the relationship between the gross margin and net sales. It is calculated by using the following formula:

Gross profit rate=Gross profitNet sales×100

To Calculate: The gross profit rate for the year 2012, 2013, and 2014 of Incorporation A.

Answer 6

Chapter 5, Problem 5.1EYCT

(a)

To determine

Revenue is the total income earned by an organization by selling goods or rendering services.

Net income represents the revenue after the deduction of operating expenses from the gross profit. Its mathematical representation is as below:

Net income=Gross profit−Operating expenses

To Compute: The percentage change in total revenue, and in net income from 2013 to 2014 for Incorporation A.

Answer 7

Chapter 5, Problem 5.1EYCT

(a)

To determine

Revenue is the total income earned by an organization by selling goods or rendering services.

Net income represents the revenue after the deduction of operating expenses from the gross profit. Its mathematical representation is as below:

Net income=Gross profit−Operating expenses

To Compute: The percentage change in total revenue, and in net income from 2013 to 2014 for Incorporation A.

Answer 8

(b)

To determine

Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula:

Profit Margin=Net incomeNet sales×100

To Calculate: The profit margin for the year 2012, 2013, and 2014 of Incorporation A.

Answer 9

(b)

To determine

Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula:

Profit Margin=Net incomeNet sales×100

To Calculate: The profit margin for the year 2012, 2013, and 2014 of Incorporation A.

Answer 10

(c)

To determine

Gross profit rate is the financial ratio that evaluates the money left over out of the total revenues after deducting the cost of goods sold. Thus, it shows the relationship between the gross margin and net sales. It is calculated by using the following formula:

Gross profit rate=Gross profitNet sales×100

To Calculate: The gross profit rate for the year 2012, 2013, and 2014 of Incorporation A.

Answer 11

(c)

To determine

Gross profit rate is the financial ratio that evaluates the money left over out of the total revenues after deducting the cost of goods sold. Thus, it shows the relationship between the gross margin and net sales. It is calculated by using the following formula:

Gross profit rate=Gross profitNet sales×100

To Calculate: The gross profit rate for the year 2012, 2013, and 2014 of Incorporation A.

Answer 12

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Answer 13

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Answer 14

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Answer 15

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Solution Summary: The author calculates the percentage change in total revenue and net income from 2013 to 2014 for Incorporation A.

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