Assume You Are Using Net Sales as the Base in Vertical

question 5

Multiple Choice

Assume you are using net sales as the base in vertical analysis.Cost of goods sold in 2016 is 67%,and is 70% in 2017.This would always indicate that:

• A) gross margin has declined
• B) cost of goods sold as a percentage of net sales has increased
• C) the dollar amount of cost of goods sold has increased
• D) gross margin has declined, cost of goods sold as a percentage of net sales has increased, and the dollar amount of cost of goods sold has increased

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Definitions:

Imports

Goods or services brought into a country from abroad for sale, which can impact the domestic economy and domestic industries.

Current Account Deficits

Occurs when a country's total imports of goods, services, and transfers exceed its total exports, indicating that it is spending more on foreign trade than it is earning.

Trade Surpluses

A condition in international trade where a country exports more goods and services than it imports.

Balance Of Payments Surpluses

A situation where the total amount of money coming into a country from abroad exceeds the total amount of money leaving the country.