A Company Reported a Decrease in Sales Revenue from $860,000

question 175

Essay

A company reported a decrease in sales revenue from $860,000 last year to $760,000 this year and a decrease in gross profit from $400,000 last year to $360,000 this year.
Required:
Part a.Calculate the gross profit percentages for both years.
Part b.Was the change in gross profit caused by the change in sales volume,the change in the gross profit per sale,or a combination of the two? Explain.

---

Definitions:

Tariffs

Taxes imposed by a government on goods and services imported from other countries, used to control trade, raise government revenue, or protect domestic industries.

Import Quotas

Import Quotas are government-imposed limits on the quantity of certain goods that can be imported, aiming to protect domestic industries.

Debt Relief

A measure or a set of measures aimed at reducing or restructuring the debt of an individual, corporation, or nation to alleviate financial burden.

Foreign Aid

Economic, technical, or military assistance given by one country to another for the purpose of relief and rehabilitation, economic stabilization, or mutual defense.