CALCULATOR PRINTER VERSION BACK NEXT Wal-Mart Stores (2) Gross profit for 2014.

Question

CALCULATOR PRINTER VERSION BACK NEXT Wal-Mart Stores (2) Gross profit for 2014. (Enter amounts in millions.) Amazon.com Wal-Mart Stores $ (3) Gross profit rate for 2014. Gross profit rate Amazon.com Wal-Mart Stores (4) Operating income for 2014. (Enter amounts in millions.) Operating income (000's) Amazon.com Wal-Mart Stores (5) Percentage change in operating income from 2014 to 2013. (Show decrease with either a negative sign, e.g.-15.2% or in parentheses, eg, (15.2) %.) Percent change in operating income Wal-Mart Stores

Explanation / Answer

Part 1)

The profit margin can be calculated with the use of following formula:

Profit Margin = Net Income/Total Sales*100

Using the values provided in the question, we get,

Profit Margin (Amazon) = -241/88,988*100 = -27.1%

Profit Margin (Walmart) = 16,022/476,294*100 = 3.4%

_____

Part 2)

The value of gross profit for 2014 is arrived as below:

Gross Profit = Total Sales - Cost of Sales

Using the values provided in the question, we get,

Gross Profit (Amazon) = 88,988 - 62,752 = $26,236 million

Gross Profit (Walmart) = 476,294 - 358,069 = $118,225 million

_____

Part 3)

The gross profit rate can be calculated with the use of following formula:

Gross Profit Rate = Gross Profit/Total Sales*100

Using the values provided in the question, we get,

Gross Profit Rate (Amazon) = 26,236/88,988*100 = 29.5%

Gross Profit Rate (Walmart) = 118,225/476,294*100 = 24.8%

_____

Part 4)

The operating income for 2014 for both the companies is given as below:

Operating Income (Amazon) = $178 million

Operating Income (Walmart) = $26,872 million

_____

Part 5)

The percentage change in operating income is determined as below:

Percentage Change in Operating Income = (Operating Income for 2014 - Operating Income for 2013)/Operating Income for 2013*100

Using the values provided in the question, we get,

Percentage Change in Operating Income (Amazon) = (178 - 745)/745*100 = -76.1%

Percentage Change in Operating Income (Walmart) = (26,872 - 27,725)/27,725*100 = -3.08%

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.