Compute the Gross Profit Rate When Sales Are $400,000; Net

question 55

Multiple Choice

Compute the gross profit rate when sales are $400,000; net sales are $380,000 and gross profits are $125,000.

• A)31.25%
• B)32.89%
• C)0.3125 to 1
• D)0.3289 to 1

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Definitions:

Cigarette Prices

The retail cost of cigarettes, which can be influenced by factors such as taxes, production costs, and demand.

Elastic Demand

A demand situation where the quantity demanded of a good or service changes significantly when its price changes.

Total Revenue

The total amount of money a firm receives from sales of its goods or services, calculated as the price per unit times the number of units sold.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a given price over a specified period of time.