Which Statement Concerning the Gross Profit Ratio Is Not True

question 29

Multiple Choice

Which statement concerning the gross profit ratio is not true?

• A) A decline in the ratio represents an unfavourable trend.
• B) It is calculated as gross profit divided by net sales.
• C) It can be compared with ratios for similar businesses.
• D) A decline in the ratio can be caused by decreases in the cost of sales.

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Definitions:

Parties

Entities or individuals involved in a legal proceeding, agreement, or social gathering.

Motivate Employees

The process of inspiring staff to perform their jobs with enthusiasm, commitment, and high levels of effort.

Ownership

Refers to the legal rights and responsibilities associated with possessing an asset or property.