Calculate Net Sales, Gross Profit, and Gross Profit Ratio for Each

question 22

Essay

Calculate net sales, gross profit, and gross profit ratio for each of the following situations. Round the gross profit ratio figure to the nearest whole percent.
a. Which situation has the highest net sales?
b. Which situation has the highest gross profit ratio?

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Definitions:

Net Income

The total profit or loss of a company after all revenues, expenses, taxes, and costs have been subtracted.

Financial Statements

Reports that summarize the financial performance and position of a business, including the balance sheet, income statement, and cash flow statement.

Accrued Revenues

Revenues earned but not yet received in cash or recorded at the statement date, often recognizing revenue before the payment is received.

Financial Statements

Financial Statements are formal records of the financial activities and position of a business, person, or other entity, presented in a structured manner.