Profit Margin: Profit margin ratio reflects the portion of net income in the net sales. It is a profitability measure tool that is used to evaluate the net income a business earns on every dollar of net sales. It is computed as net income divided by net revenue. Operating Profit: Operating profit or income is the excess of sales revenue over the operating expenses of a company. It is used to measure the profitability of company’s operations. Comprehensive Income: It’s a measure of company’s total income that includes unrealized gain that has not been received like gain on available for sale securities. To compute: The profit margin of Company L for 2013 and compare it with that of 2011.

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Answer 1

Question

Chapter 18, Problem 18.1IFRS

(a)

To determine

Profit Margin: Profit margin ratio reflects the portion of net income in the net sales. It is a profitability measure tool that is used to evaluate the net income a business earns on every dollar of net sales. It is computed as net income divided by net revenue.

Operating Profit: Operating profit or income is the excess of sales revenue over the operating expenses of a company. It is used to measure the profitability of company’s operations.

Comprehensive Income: It’s a measure of company’s total income that includes unrealized gain that has not been received like gain on available for sale securities.

To compute: The profit margin of Company L for 2013 and compare it with that of 2011.

(b)

To determine

To identify: The operating profit recorded for 2013 by Company L.

(c)

To determine

To identify: The comprehensive gains and losses recorded in 2013 by Company L.

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Answer 2

Question

Chapter 18, Problem 18.1IFRS

(a)

To determine

Profit Margin: Profit margin ratio reflects the portion of net income in the net sales. It is a profitability measure tool that is used to evaluate the net income a business earns on every dollar of net sales. It is computed as net income divided by net revenue.

Operating Profit: Operating profit or income is the excess of sales revenue over the operating expenses of a company. It is used to measure the profitability of company’s operations.

Comprehensive Income: It’s a measure of company’s total income that includes unrealized gain that has not been received like gain on available for sale securities.

To compute: The profit margin of Company L for 2013 and compare it with that of 2011.

(b)

To determine

To identify: The operating profit recorded for 2013 by Company L.

(c)

To determine

To identify: The comprehensive gains and losses recorded in 2013 by Company L.

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Answer 3

Question

Chapter 18, Problem 18.1IFRS

(a)

To determine

Profit Margin: Profit margin ratio reflects the portion of net income in the net sales. It is a profitability measure tool that is used to evaluate the net income a business earns on every dollar of net sales. It is computed as net income divided by net revenue.

Operating Profit: Operating profit or income is the excess of sales revenue over the operating expenses of a company. It is used to measure the profitability of company’s operations.

Comprehensive Income: It’s a measure of company’s total income that includes unrealized gain that has not been received like gain on available for sale securities.

To compute: The profit margin of Company L for 2013 and compare it with that of 2011.

(b)

To determine

To identify: The operating profit recorded for 2013 by Company L.

(c)

To determine

To identify: The comprehensive gains and losses recorded in 2013 by Company L.

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Answer 4

Question

Chapter 18, Problem 18.1IFRS

(a)

To determine

Profit Margin: Profit margin ratio reflects the portion of net income in the net sales. It is a profitability measure tool that is used to evaluate the net income a business earns on every dollar of net sales. It is computed as net income divided by net revenue.

Operating Profit: Operating profit or income is the excess of sales revenue over the operating expenses of a company. It is used to measure the profitability of company’s operations.

Comprehensive Income: It’s a measure of company’s total income that includes unrealized gain that has not been received like gain on available for sale securities.

To compute: The profit margin of Company L for 2013 and compare it with that of 2011.

(b)

To determine

To identify: The operating profit recorded for 2013 by Company L.

(c)

To determine

To identify: The comprehensive gains and losses recorded in 2013 by Company L.

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Answer 5

Chapter 18, Problem 18.1IFRS

(a)

To determine

Profit Margin: Profit margin ratio reflects the portion of net income in the net sales. It is a profitability measure tool that is used to evaluate the net income a business earns on every dollar of net sales. It is computed as net income divided by net revenue.

Operating Profit: Operating profit or income is the excess of sales revenue over the operating expenses of a company. It is used to measure the profitability of company’s operations.

Comprehensive Income: It’s a measure of company’s total income that includes unrealized gain that has not been received like gain on available for sale securities.

To compute: The profit margin of Company L for 2013 and compare it with that of 2011.

(b)

To determine

To identify: The operating profit recorded for 2013 by Company L.

(c)

To determine

To identify: The comprehensive gains and losses recorded in 2013 by Company L.

Answer 6

Chapter 18, Problem 18.1IFRS

(a)

To determine

Profit Margin: Profit margin ratio reflects the portion of net income in the net sales. It is a profitability measure tool that is used to evaluate the net income a business earns on every dollar of net sales. It is computed as net income divided by net revenue.

Operating Profit: Operating profit or income is the excess of sales revenue over the operating expenses of a company. It is used to measure the profitability of company’s operations.

Comprehensive Income: It’s a measure of company’s total income that includes unrealized gain that has not been received like gain on available for sale securities.

To compute: The profit margin of Company L for 2013 and compare it with that of 2011.

Answer 7

Chapter 18, Problem 18.1IFRS

(a)

To determine

Profit Margin: Profit margin ratio reflects the portion of net income in the net sales. It is a profitability measure tool that is used to evaluate the net income a business earns on every dollar of net sales. It is computed as net income divided by net revenue.

Operating Profit: Operating profit or income is the excess of sales revenue over the operating expenses of a company. It is used to measure the profitability of company’s operations.

Comprehensive Income: It’s a measure of company’s total income that includes unrealized gain that has not been received like gain on available for sale securities.

To compute: The profit margin of Company L for 2013 and compare it with that of 2011.

Answer 8

(b)

To determine

To identify: The operating profit recorded for 2013 by Company L.

Answer 9

(b)

To determine

To identify: The operating profit recorded for 2013 by Company L.

Answer 10

(c)

To determine

To identify: The comprehensive gains and losses recorded in 2013 by Company L.

Answer 11

(c)

To determine

To identify: The comprehensive gains and losses recorded in 2013 by Company L.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 18 - Prob. 1Q Ch. 18 - Prob. 2Q Ch. 18 - Prob. 3Q Ch. 18 - Prob. 4Q Ch. 18 - Prob. 5Q Ch. 18 - Prob. 6Q Ch. 18 - Prob. 7Q Ch. 18 - Prob. 8Q Ch. 18 - Prob. 9Q Ch. 18 - Prob. 10Q

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To identify: The operating profit recorded for 2013 by Company L.

To identify: The comprehensive gains and losses recorded in 2013 by Company L.

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