Financial Accounting (12th Edition) (What's New in Accounting)
12th Edition
ISBN: 9780134725987
Author: C. William Thomas, Wendy M. Tietz, Walter T. Harrison Jr.
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Videos
Question
Chapter 12, Problem 12.51Q
To determine
The trend of returns on sales of Medical O.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
A firm’s balance sheets for the last two years are as follows (refer to image):
Sales in 20X1 were $250,000. Sales in 20X2 were $250,000.
a. Based solely on the current ratio and the quick ratio, has the firm’s liquidity position deteriorated or improved?
b. Without doing a calculation, has days sales outstanding (receivables turnover) improved? How do you know?
c. Without doing a calculation, has inventory turnover deteriorated? How do you know?
d. If the firm earned $5,000 during 2012, what proportion of those earningswere distributed?
Flair ranks the individual customers in the Ma and Pa single-store distribution market on the basis of monthly operating income. The cumulative operating income of the top 20% of customers is $58,120. Best Drugs reports operating losses of $23,670 for the bottom 40% of its customers. Make four recommendations that you think Best Drugs should consider in light of this new customer-profitability information.
The following information is available to you for the Wooden Company:
2011 2010
Net Income. 53,394 39,510
Net Sales 233,715 182,795
From the information provided, calculate Wooden’s profit margin ratio for each year. Be sure to show your calculations.
2011
2010
Comment on the results, assuming that the industry average for the profit margin ratio is 25% for each of the two years.
Chapter 12 Solutions
Financial Accounting (12th Edition) (What's New in Accounting)
Ch. 12 - Prob. 1QCCh. 12 - Prob. 2QCCh. 12 - Prob. 3QCCh. 12 - Prob. 4QCCh. 12 - Expressing accounts receivable as a percentage of...Ch. 12 - Kincaid Company reported the following data (in...Ch. 12 - Prob. 7QCCh. 12 - Ratios that measure liquidity include all of the...Ch. 12 - Verba Corporation has an inventory turnover of 15...Ch. 12 - The measure of a companys ability to collect cash...
Ch. 12 - A ratio that measures a companys profitability is...Ch. 12 - Prob. 12QCCh. 12 - Prob. 13QCCh. 12 - Prob. 14QCCh. 12 - Prob. 12.1ECCh. 12 - Prob. 12.1SCh. 12 - Prob. 12.2SCh. 12 - Prob. 12.3SCh. 12 - Prob. 12.4SCh. 12 - Prob. 12.5SCh. 12 - (Learning Objective 4: Evaluate a companys quick...Ch. 12 - Prob. 12.7SCh. 12 - (Learning Objective 4: Measure ability to pay...Ch. 12 - (Learning Objective 4: Measure profitability using...Ch. 12 - Prob. 12.10SCh. 12 - (Learning Objective 4: Use ratio data to...Ch. 12 - Prob. 12.12SCh. 12 - (Learning Objective 4: Analyze a company based on...Ch. 12 - Prob. 12.14SCh. 12 - Prob. 12.15SCh. 12 - Prob. 12.16AECh. 12 - Prob. 12.17AECh. 12 - Prob. 12.18AECh. 12 - Prob. 12.19AECh. 12 - Prob. 12.20AECh. 12 - Prob. 12.21AECh. 12 - Prob. 12.22AECh. 12 - Prob. 12.23AECh. 12 - Prob. 12.24AECh. 12 - Prob. 12.25AECh. 12 - Prob. 12.26AECh. 12 - Prob. 12.27BECh. 12 - Prob. 12.28BECh. 12 - Prob. 12.29BECh. 12 - Prob. 12.30BECh. 12 - Prob. 12.31BECh. 12 - LO 4 (Learning Objective 4: Calculate ratios;...Ch. 12 - Prob. 12.33BECh. 12 - Prob. 12.34BECh. 12 - Prob. 12.35BECh. 12 - Prob. 12.36BECh. 12 - Prob. 12.37BECh. 12 - Prob. 12.38QCh. 12 - Prob. 12.39QCh. 12 - Prob. 12.40QCh. 12 - Prob. 12.41QCh. 12 - Prob. 12.42QCh. 12 - Prob. 12.43QCh. 12 - Prob. 12.44QCh. 12 - Use the Orlando Medical Corporation financial...Ch. 12 - Prob. 12.46QCh. 12 - Use the Orlando Medical Corporation financial...Ch. 12 - Prob. 12.48QCh. 12 - Prob. 12.49QCh. 12 - Prob. 12.50QCh. 12 - Prob. 12.51QCh. 12 - Prob. 12.52QCh. 12 - Prob. 12.53QCh. 12 - Prob. 12.54QCh. 12 - Prob. 12.55QCh. 12 - LO 1, 2, 4 (Learning Objectives 1, 2, 4: Calculate...Ch. 12 - Prob. 12.57APCh. 12 - Prob. 12.58APCh. 12 - LO 4 (Learning Objective 4: Use ratios to evaluate...Ch. 12 - Prob. 12.60APCh. 12 - LO 2, 4, 5 (Learning Objectives 2, 4, 5: Analyze...Ch. 12 - Group B LO 1, 2, 4 (Learning Objectives 1, 2, 4:...Ch. 12 - Prob. 12.63BPCh. 12 - Prob. 12.64BPCh. 12 - LO 4 (Learning Objective 4: Use ratios to evaluate...Ch. 12 - Prob. 12.66BPCh. 12 - LO 2, 4, 5 (Learning Objectives 2, 4, 5: Analyze...Ch. 12 - Prob. 12.68CEPCh. 12 - Prob. 12.69CEPCh. 12 - (Learning Objectives 2, 3.4: Use trend...Ch. 12 - (Learning Objectives 4, 5: Calculate and analyze...Ch. 12 - Prob. 12.72DCCh. 12 - Prob. 12.73DCCh. 12 - Prob. 12.74EICCh. 12 - Focus on Financials Apple Inc. LO 1, 2, 3, 4, 5...Ch. 12 - Comprehensive Financial Statement Analysis Project...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Adams Inc. determines its expected sales for the next quarter as $800,000 and its margin of safety as 40% Which of the following statements is NOT true for the next quarter for Adams? Group of answer choices An operating loss will occur, if the sales drop by $320,000. The breakeven sales are determined to be $480,000 The company will make a breakeven, if the sales drops by 40%. if the sales drops more than 40%, an operating loss will occur.arrow_forwardThe following data for the years ended December 31, 2019 and 2020 were presented to the management Zigzag Company: 2020 = Net sales: 1,363,000, Cost of Sales: 911,800, Gross Profit: 451,200; 2019 = Net Sales: 1,250,000, Cost of Sales: 776,000, Gross Profit: 474,000. The management requested you to determine the cause of the decline in gross profit on sales in spite of the favorable information given by the sales division that the quantity sold in 2020 was higher than in 2019 and that the production costs in 2020 were lower than that of 2019 by 6%. The percent change in volume is A. 17.50% B. 14.00% C. 25.00% D. 20.00%arrow_forwardThe following data for the years ended December 31, 2019 and 2020 were presented to the management Zigzag Company: 2020 = Net sales: 1,363,000, Cost of Sales: 911,800, Gross Profit: 451,200; 2019 = Net Sales: 1,250,000, Cost of Sales: 776,000, Gross Profit: 474,000. The management requested you to determine the cause of the decline in gross profit on sales in spite of the favorable information given by the sales division that the quantity sold in 2020 was higher than in 2019 and that the production costs in 2020 were lower than that of 2019 by 6%. The increase (decrease) in net sales due to volume factor is: a. (P194,000) b. P194,000 c. (P312,500) d. P312,500arrow_forward
- The following data for the years ended December 31, 2019 and 2020 were presented to the management Zigzag Company: 2020 = Net sales: 1,363,000, Cost of Sales: 911,800, Gross Profit: 451,200; 2019 = Net Sales: 1,250,000, Cost of Sales: 776,000, Gross Profit: 474,000. The management requested you to determine the cause of the decline in gross profit on sales in spite of the favorable information given by the sales division that the quantity sold in 2020 was higher than in 2019 and that the production costs in 2020 were lower than that of 2019 by 6%. The percent change in volume is: (Based on information given above) The increase (decrease) in net sales due to volume factor is:arrow_forwardThe following data for the years ended December 31, 2019 and 2020 were presented to the management Zigzag Company: 2020 = Net sales: 1,363,000, Cost of Sales: 911,800, Gross Profit: 451,200; 2019 = Net Sales: 1,250,000, Cost of Sales: 776,000, Gross Profit: 474,000. The management requested you to determine the cause of the decline in gross profit on sales in spite of the favorable information given by the sales division that the quantity sold in 2020 was higher than in 2019 and that the production costs in 2020 were lower than that of 2019 by 6%. The percent change in volume is: 17.50% 14.00% 25.00% 20.00%arrow_forwardThe following data for the years ended December 31, 2019 and 2020 were presented to the management Zigzag Company: 2020 = Net sales: 1,363,000, Cost of Sales: 911,800, Gross Profit: 451,200; 2019 = Net Sales: 1,250,000, Cost of Sales: 776,000, Gross Profit: 474,000. The management requested you to determine the cause of the decline in gross profit on sales in spite of the favorable information given by the sales division that the quantity sold in 2020 was higher than in 2019 and that the production costs in 2020 were lower than that of 2019 by 6%. The increase (decrease) in net sales due to cost factor is A. (P135,800) B. 135,800 C. (P58,200) D. 58,200arrow_forward
- The following data for the years ended December 31, 2019 and 2020 were presented to the management Zigzag Company: 2020 = Net sales: 1,363,000, Cost of Sales: 911,800, Gross Profit: 451,200; 2019 = Net Sales: 1,250,000, Cost of Sales: 776,000, Gross Profit: 474,000. The management requested you to determine the cause of the decline in gross profit on sales in spite of the favorable information given by the sales division that the quantity sold in 2020 was higher than in 2019 and that the production costs in 2020 were lower than that of 2019 by 6%. The increase (decrease) in net sales due to price factor is: A. (113,000) B. 113,000 C. (P199,500) D. 199,500arrow_forwardThe following data for the years ended December 31, 2019 and 2020 were presented to the management Zigzag Company: 2020 = Net sales: 1,363,000, Cost of Sales: 911,800, Gross Profit: 451,200; 2019 = Net Sales: 1,250,000, Cost of Sales: 776,000, Gross Profit: 474,000. The management requested you to determine the cause of the decline in gross profit on sales in spite of the favorable information given by the sales division that the quantity sold in 2020 was higher than in 2019 and that the production costs in 2020 were lower than that of 2019 by 6%. (Based on information given above) The increase (decrease) in net sales due to volume factor is: (P194,000) P194,000 (P312,500) P312,500 (Based on information given above) The increase (decrease) in net sales due to price factor is: (P113,000) P113,000 (P199,500) P199,500 (Based on information given above) The increase (decrease) in net sales due to cost factor is: (P135,800) P135,800…arrow_forward1. If last year's sales were $906,050 and a store was planning an increase in sales of 3.75% and a markdown percent of 18.25%, what is the planned markdown in dollars? (Present your answer rounded to the dollar with a dollar sign and comma separator (i.e. $109,455).) 2. Using the following data, calculate the planned April purchases at cost. (Present your answer rounded to the dollar with a dollar sign and comma separator (i.e. $109,455).) Sales $220,000 BOM Stock for April $380,000 BOM Stock for May $240,000 Markup 51% Markdowns 2.3%arrow_forward
- From last year to this year, Berry Barn reported that itsNet Sales increased from $300,000 to $400,000 and itsGross Profit increased from $90,000 to $130,000. Was theGross Profit increase caused by ( a ) an increase in salesvolume only, ( b ) an increase in gross profit per sale only,or ( c ) a combination of both? Explain your answer.arrow_forwardSuppose you manage a company, which presents the following financial indicators: Current Ratio: 2 Average Collection Period: 76.3 days Inventory Turnover: 6.7 Operating Income Return on Investment: 13.2% Debt Ratio: 32% The competition has the following results: Current Ratio: 2 Average Collection Period: 35 days Inventory Turnover: 6.7 Operating Income Return on Investment:10% Debt Ratio: 60% How is the financial situation of your company? Justify your answer.arrow_forwardSolvency and Profitability Trend Analysis (Picture is attached and this is the only one I got wrong, what did I do wrong?) Addai Company has provided the following comparative information: 20Y8 20Y7 20Y6 20Y5 20Y4 Net income $273,406 $367,976 $631,176 $884,000 $800,000 Interest expense 616,047 572,003 528,165 495,000 440,000 Income tax expense 31,749 53,560 106,720 160,000 200,000 Total assets (ending balance) 4,417,178 4,124,350 3,732,443 3,338,500 2,750,000 Total stockholders’ equity (ending balance) 3,706,557 3,433,152 3,065,176 2,434,000 1,550,000 Average total assets 4,270,764 3,928,396 3,535,472 3,044,250 2,475,000 Average total stockholders' equity 3,569,855 3,249,164 2,749,588 1,992,000 1,150,000 You have been asked to evaluate the historical performance of the company over the last five years. Selected industry ratios have remained relatively steady at the following…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Survey of Accounting (Accounting I)AccountingISBN:9781305961883Author:Carl WarrenPublisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning
Excel Applications for Accounting PrinciplesAccountingISBN:9781111581565Author:Gaylord N. SmithPublisher:Cengage Learning
Survey of Accounting (Accounting I)
Accounting
ISBN:9781305961883
Author:Carl Warren
Publisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Cengage Learning
How To Analyze an Income Statement; Author: Daniel Pronk;https://www.youtube.com/watch?v=uVHGgSXtQmE;License: Standard Youtube License