(a) Introduction: Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory. To state: An increase in the gross profit percentage will have a favorable or unfavorable impact.

Question

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Answer 1

Question

Chapter 13, Problem 10Q

To determine

(a)

Introduction:

Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory.

To state:

An increase in the gross profit percentage will have a favorable or unfavorable impact.

To determine

(b)

Introduction:

Inventory turnover ratio measures the number of times a company has sold its inventory.

To state:

Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

To determine

(c)

Introduction:

Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability.

To state:

Increase in earnings per share will have a favorable or unfavorable impact.

To determine

(d)

Introduction:

Days to collect are the average number of days in which a company collects its accounts receivables in a year.

To state:

Decrease in days to collect will have a favorable or unfavorable impact.

To determine

(e)

Introduction:

Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue.

To state:

Increase in net profit margin will have a favorable or unfavorable impact.

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When a company determines that the net realizable value of its ending inventory is lower than its cost, what would be the effect(s) of the adjustment to write down inventory to net realizable value? a. Decrease total assets. b. Decrease net income. c. Decrease retained earnings. d. All of these answer choices are correct.

Answer 2

Question

Chapter 13, Problem 10Q

To determine

(a)

Introduction:

Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory.

To state:

An increase in the gross profit percentage will have a favorable or unfavorable impact.

To determine

(b)

Introduction:

Inventory turnover ratio measures the number of times a company has sold its inventory.

To state:

Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

To determine

(c)

Introduction:

Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability.

To state:

Increase in earnings per share will have a favorable or unfavorable impact.

To determine

(d)

Introduction:

Days to collect are the average number of days in which a company collects its accounts receivables in a year.

To state:

Decrease in days to collect will have a favorable or unfavorable impact.

To determine

(e)

Introduction:

Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue.

To state:

Increase in net profit margin will have a favorable or unfavorable impact.

Expert Solution & Answer

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Answer 3

Question

Chapter 13, Problem 10Q

To determine

(a)

Introduction:

Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory.

To state:

An increase in the gross profit percentage will have a favorable or unfavorable impact.

To determine

(b)

Introduction:

Inventory turnover ratio measures the number of times a company has sold its inventory.

To state:

Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

To determine

(c)

Introduction:

Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability.

To state:

Increase in earnings per share will have a favorable or unfavorable impact.

To determine

(d)

Introduction:

Days to collect are the average number of days in which a company collects its accounts receivables in a year.

To state:

Decrease in days to collect will have a favorable or unfavorable impact.

To determine

(e)

Introduction:

Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue.

To state:

Increase in net profit margin will have a favorable or unfavorable impact.

Expert Solution & Answer

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Answer 4

Question

Chapter 13, Problem 10Q

To determine

(a)

Introduction:

Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory.

To state:

An increase in the gross profit percentage will have a favorable or unfavorable impact.

To determine

(b)

Introduction:

Inventory turnover ratio measures the number of times a company has sold its inventory.

To state:

Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

To determine

(c)

Introduction:

Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability.

To state:

Increase in earnings per share will have a favorable or unfavorable impact.

To determine

(d)

Introduction:

Days to collect are the average number of days in which a company collects its accounts receivables in a year.

To state:

Decrease in days to collect will have a favorable or unfavorable impact.

To determine

(e)

Introduction:

Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue.

To state:

Increase in net profit margin will have a favorable or unfavorable impact.

Expert Solution & Answer

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See solution

Answer 5

Chapter 13, Problem 10Q

To determine

(a)

Introduction:

Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory.

To state:

An increase in the gross profit percentage will have a favorable or unfavorable impact.

To determine

(b)

Introduction:

Inventory turnover ratio measures the number of times a company has sold its inventory.

To state:

Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

To determine

(c)

Introduction:

Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability.

To state:

Increase in earnings per share will have a favorable or unfavorable impact.

To determine

(d)

Introduction:

Days to collect are the average number of days in which a company collects its accounts receivables in a year.

To state:

Decrease in days to collect will have a favorable or unfavorable impact.

To determine

(e)

Introduction:

Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue.

To state:

Increase in net profit margin will have a favorable or unfavorable impact.

Answer 6

Chapter 13, Problem 10Q

To determine

(a)

Introduction:

Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory.

To state:

An increase in the gross profit percentage will have a favorable or unfavorable impact.

Answer 7

Chapter 13, Problem 10Q

To determine

(a)

Introduction:

Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory.

To state:

An increase in the gross profit percentage will have a favorable or unfavorable impact.

Answer 8

To determine

(b)

Introduction:

Inventory turnover ratio measures the number of times a company has sold its inventory.

To state:

Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

Answer 9

To determine

(b)

Introduction:

Inventory turnover ratio measures the number of times a company has sold its inventory.

To state:

Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

Answer 10

To determine

(c)

Introduction:

Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability.

To state:

Increase in earnings per share will have a favorable or unfavorable impact.

Answer 11

To determine

(c)

Introduction:

Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability.

To state:

Increase in earnings per share will have a favorable or unfavorable impact.

Answer 12

To determine

(d)

Introduction:

Days to collect are the average number of days in which a company collects its accounts receivables in a year.

To state:

Decrease in days to collect will have a favorable or unfavorable impact.

Answer 13

To determine

(d)

Introduction:

Days to collect are the average number of days in which a company collects its accounts receivables in a year.

To state:

Decrease in days to collect will have a favorable or unfavorable impact.

Answer 14

To determine

(e)

Introduction:

Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue.

To state:

Increase in net profit margin will have a favorable or unfavorable impact.

Answer 15

To determine

(e)

Introduction:

Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue.

To state:

Increase in net profit margin will have a favorable or unfavorable impact.

Answer 16

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Answer 17

Expert Solution & Answer

Answer 18

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Answer 19

Ch. 13 - Prob. 1Q Ch. 13 - Prob. 2Q Ch. 13 - What is ratio analysis? Why is it useful? Ch. 13 - What benchmarks are commonly used for interpreting...Ch. 13 - Prob. 5Q Ch. 13 - Why are some analyses called horizontal and others...Ch. 13 - Slow Cellar’s current ratio increased from 1.2 to...Ch. 13 - From last year to this year. Colossal Company’s...Ch. 13 - From last year to this year, Berry Barn reported...Ch. 13 - Prob. 10Q

(a) Introduction: Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory. To state: An increase in the gross profit percentage will have a favorable or unfavorable impact.

Solution Summary: The author explains gross profit percentage, inventory turnover ratio, earnings per share, and net profit margin.

(a)

Introduction:

Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory.

To state:

An increase in the gross profit percentage will have a favorable or unfavorable impact.

(b)

Introduction:

Inventory turnover ratio measures the number of times a company has sold its inventory.

To state:

Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

(c)

Introduction:

Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability.

To state:

Increase in earnings per share will have a favorable or unfavorable impact.

(d)

Introduction:

Days to collect are the average number of days in which a company collects its accounts receivables in a year.

To state:

Decrease in days to collect will have a favorable or unfavorable impact.

(e)

Introduction:

Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue.

To state:

Increase in net profit margin will have a favorable or unfavorable impact.

Want to see the full answer?

Chapter 13 Solutions

(a) Introduction: Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory. To state: An increase in the gross profit percentage will have a favorable or unfavorable impact.

Solution Summary: The author explains gross profit percentage, inventory turnover ratio, earnings per share, and net profit margin.

(a) Introduction: Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory. To state: An increase in the gross profit percentage will have a favorable or unfavorable impact.

(b) Introduction: Inventory turnover ratio measures the number of times a company has sold its inventory. To state: Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

(c) Introduction: Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability. To state: Increase in earnings per share will have a favorable or unfavorable impact.

(d) Introduction: Days to collect are the average number of days in which a company collects its accounts receivables in a year. To state: Decrease in days to collect will have a favorable or unfavorable impact.

(e) Introduction: Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue. To state: Increase in net profit margin will have a favorable or unfavorable impact.

Want to see the full answer?

Chapter 13 Solutions

(a)

Introduction:

Gross profit percentage helps the company to compare gross margin to the net sales. This ratio tells the profitability at which company sells its inventory.

To state:

An increase in the gross profit percentage will have a favorable or unfavorable impact.

(b)

Introduction:

Inventory turnover ratio measures the number of times a company has sold its inventory.

To state:

Decrease in the inventory turnover ratio will have a favorable or unfavorable impact.

(c)

Introduction:

Earnings per share (EPS) is profit of the company which is divided by common stock per share. Earnings per share acts as an indicator of a company's profitability.

To state:

Increase in earnings per share will have a favorable or unfavorable impact.

(d)

Introduction:

Days to collect are the average number of days in which a company collects its accounts receivables in a year.

To state:

Decrease in days to collect will have a favorable or unfavorable impact.

(e)

Introduction:

Net profit margin ratio is calculated by dividing net income by the net sales. It helps in calculating the net income as a percentage of revenue.

To state:

Increase in net profit margin will have a favorable or unfavorable impact.