Do It! Review 5-06
Tamarisk, Inc. reported the following in its 2022 and 2021 income statements.
2022 | 2021 | |||
---|---|---|---|---|
Net sales |
$158,000 | $128,000 | ||
Cost of goods sold |
94,800 | 76,800 | ||
Operating expenses |
31,600 | 19,200 | ||
Income tax expense |
18,600 | 10,600 | ||
Net income |
$ 13,000 | $ 21,400 |
Determine the company’s gross profit rate and profit margin for
both years. (Round answers to 1 decimal place, e.g.
52.7%.)
2022 | 2021 | |||
---|---|---|---|---|
Gross profit rate |
enter percentages rounded to 1 decimal place
|
enter percentages rounded to 1 decimal place
|
||
Profit margin |
enter percentages rounded to 1 decimal place
|
enter percentages rounded to 1 decimal place
|
Gross profit rate = Gross Profit/Sales
Profit Margin = Net income/Sales
2022 | 2021 | |
---|---|---|
Gross profit rate |
= (158,000-94,800)/158,000 = 40% |
= (128,000-76,800)/128,000 = 40% |
Profit Margin |
= (13,000/158,000) = 8.2% |
= (21,400/128,000) = 16.7% |
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Do It! Review 5-06 Tamarisk, Inc. reported the following in its 2022 and 2021 income statements....
Do It! Review 5-06
Pharoah Company reported the following in its 2022 and 2021
income statements.
2022
2021
Net sales
$150,000
$130,000
Cost of goods sold
90,000
78,000
Operating expenses
36,000
18,200
Income tax expense
18,600
11,200
Net income
$ 5,400
$ 22,600
Determine the company’s gross profit rate and profit margin for
both years. (Round answers to 1 decimal place, e.g.
52.7%.)
2022
2021
Gross profit rate
enter percentages rounded to 1 decimal place
%
enter percentages rounded to...
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