Nueva Company Reported the Following Pretax Data for Its First

question 13

Multiple Choice

Nueva Company reported the following pretax data for its first year of operations.
- What is Nueva's gross profit ratio (rounded) if it elects FIFO?

• A) 30%.
• B) 32%.
• C) 10.7%.
• D) 60%.

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Definitions:

Commercial

Related to the buying and selling of goods and services or to business activities in general.

Consumer

An individual who purchases goods or services for personal use rather than for manufacturing or resale.

Lost Check

A check that has been misplaced, destroyed, or otherwise lost, potentially leading to the issuance of a stop payment order and requiring a replacement.

Drawer

In banking and finance, the person who writes or issues a check or draft instructing the bank to pay a specified amount of money to a designated party.