Use the Following Information for Questions Below -The Common-Size Percentage for Selling and Administration Costs in 2020

question 9

Multiple Choice

Use the following information for questions below.
Consider the following income statement data for Barolo Inc.:
$$\begin{array}{l}\begin{array} { l l r } &2020&2019\\\text {Sales revenue }&\$ 97,300&\$86,200\\\text {Less: Cost of goods sold }&45,600&53,400\\\text {Gross profit }&51,700&32,800\\\text {Less: Selling and administration costs }&22,500&18,300\\\text {Net Income }&\$29,200&\$14,500\\\end{array}\end{array}$$
-The common-size percentage for selling and administration costs in 2020 was

• A)21.2%.
• B)23.1%.
• C)43.5%.
• D)77.0%.

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Definitions:

Business Area

A specific domain within an organization or market where distinct products or services are developed, marketed, and managed.

Industry Environmental Factors

External influences that affect an industry’s performance, including economic, technological, legal, and socio-cultural elements.

Resource Suppliers

Entities or individuals that provide the essential materials, equipment, or services required by an organization to conduct its operations.

Strategic Management

The process of formulating, implementing, and evaluating cross-functional decisions that enable an organization to achieve its objectives.