#57 The portion of the functional income statements of Brief Company for2021 and 2020 are presented below:20212020SalesP890,000P800,000Cost of goods530,000450,000soldGross margin360,000350,000Assuming that the selling price in 2021 is reduced by 11 percent effectiveJanuary 1, calculate the change in gross profit due to change in unit cost.O P25,694 UnfavorableO P32,500 FavorableO P25,694 FavorableO P32,500 Unfavorable

Gross Profit Margin shows the sales revenue that a company keeps aside to pay off its costs while…

Answered: Assuming that the selling price in 2021…

Assuming that the selling price in 2021 is reduced by 11 percent effective January 1, calculate the change in gross profit due to change in unit cost.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter8: Inventories: Special Valuation Issues

Section: Chapter Questions

Problem 2MC: Moore Company uses the LIFO cost flow assumption and carries Product A in inventory on December 31,...

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Question

#57

The portion of the functional income statements of Brief Company for
2021 and 2020 are presented below:
2021
2020
Sales
P890,000
P800,000
Cost of goods
530,000
450,000
sold
Gross margin
360,000
350,000
Assuming that the selling price in 2021 is reduced by 11 percent effective
January 1, calculate the change in gross profit due to change in unit cost.
O P25,694 Unfavorable
O P32,500 Favorable
O P25,694 Favorable
O P32,500 Unfavorable

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