Garrit Limited's Income Statement Reported the Following for the Year

question 71

Multiple Choice

Garrit Limited's income statement reported the following for the year ended Dec 31,2016:

Which is the correct statement about the income statement?

• A)Mark-up on selling price is $573,000.
• B)Mark-up on cost is 53.75%.
• C)Gross margin percentage is 20.32%.
• D)Mark-up on the selling price is $308,000.

---

Definitions:

Stockholders' Equity

The residual interest in the assets of a company after deducting liabilities, representing the owners' claim on the business.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) for financial reporting globally.

Convertible Preferred Stock

A type of preferred stock that gives the holder the right to convert their shares into a predetermined number of common stock shares, usually after a specific date.

Noncumulative Preferred Stock

Preferred shares that do not entitle the holder to claim dividends missed in the past if the company decides not to distribute dividends in a given year.