Oglethorpe Company Reports the Following Information from the Vertical Analysis

question 30

Multiple Choice

Oglethorpe Company reports the following information from the vertical analysis of their income statement:
Net income:
4.2 % in 2014
3.9% in 2013
Which of the following statements could be logically concluded from the above data?

• A) The company made a higher gross profit in 2014 than in 2013.
• B) The company made higher net income in 2014 than in 2013.
• C) The company has improved the profit they make per dollar of sales in 2014.
• D) The company's total net income increased by 0.3% in 2014.

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Definitions:

Annuity Due

An annuity where payments are made at the beginning of each period instead of the end.

Bargain Purchase Option

An option given to the lessee to purchase the leased asset at the end of the lease term at a price significantly lower than the expected fair market value.

Future Rents

Future rents refer to the payments that are expected to be received in the future for the use of an asset, typically real estate.

Unreimbursable Costs

Expenses that cannot be recovered or compensated for by any means.