To Follow Is Selected Information About the Blaz Company for the Current

question 22

Multiple Choice

To follow is selected information about The Blaz Company for the current year and prior year. $$\begin{array} { | l | l | l | } \hline \text { Account } & \text { Current } & \text { Priar } \\\hline \text { Net sales revenue } & \$ 648,000 & \$ 595,000 \\\hline \text { Cost of goods sold } & \$ 401,760 & \$ 425,000 \\\hline \text { Gross profit } & \$ 246,240 & \$ 170,000 \\\hline \text { Selling/general expenses } & \$ 136,080 & \$ 93,500 \\\hline \text { Net income before tax } & \$ 110,160 & \$ 76,500 \\\hline \text { Income tax } & \$ 32,400 & \$ 22,800 \\\hline \text { Net income } & \$ 77,760 & \$ 53,700 \\\hline\end{array}$$
-What is the current year's cost of goods sold percentage (as would be found on a vertical analysis of the income statement for the current year) ?

• A)62.00%
• B)67.52%
• C)-5.47%
• D)94.53%

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Definitions:

After-Tax Cost of Debt

The net cost of debt after the effects of income tax deductions on interest payments are considered.

Corporate Tax Rate

The percentage of a corporation's income that it pays as taxes to the government.

CCA Class

Refers to the Canadian Classification of Capital Assets, a system used in Canada for categorizing fixed assets for tax depreciation purposes.