Hamilton Corporation Reports the Following Data: If Net Sales

question 62

Multiple Choice

Hamilton Corporation reports the following data: If net sales increases by 15%,and cost of goods sold increases by 20%,gross margin would:

• A) increase by 4.6%
• B) decrease by 4.6%
• C) decrease by 4.4%
• D) increase by 4.4%

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Definitions:

Fixed Assets

Fixed assets are long-term tangible assets used in a company's operations, such as buildings, machinery, and equipment, which are not expected to be converted into cash in the short term.

Shares of Stock

Represent the units of ownership interest in a corporation or financial asset that investors buy and sell.

Inventory

The total amount of goods or materials held by a company, intended for sale or manufacturing into final products.

Cash Ratio

A financial metric assessing a firm's capability to meet its current obligations using its available cash and near-cash assets.