annehhit Electronies Company $5,400,000.00 2,835,000.00 $2,565,00000 $1,404,000.
ID: 2583065 • Letter: A
Question
annehhit Electronies Company $5,400,000.00 2,835,000.00 $2,565,00000 $1,404,000.00 810,000.00 $2,214,000.00 $351,000.00 315,000.00 $666,000.00 68,000.00 $598,000.00 74,000.00 $524,000.00 Industry Average 100.0% 59.5 40.5% 23.0% 13.0 36.0% 4.5% 2.0 6.5% 1.3 5.2% 2 Sales 3Cost of goods sold 4 Gross profit 5 Selling expenses 6 Administrative expenses 7lotal operating expenses 8 Income from operations Other income 10 11 Other expense 12 Income before income tax 13 Income tax expense 14 Net income 3.8%Explanation / Answer
We can calculate the Company's percentage with the help of given figures and can draw some conslusions which are as follows :
1) Companies Gross Profit rato is more than that of Industry, this is all due to its low cost of goods sold.
2) Companies Total operating expense is more than that of the industry, this is due to its higher selling and administrative cost.
3) Combined effect of its better performance gives it a high net income, this is due to higher gross profit and higher other income.
Companies percentange can be calcuated as follows :
Particulars Company Amount Company Percent Industry Average Sales 54,00,000.00 100.0% 100.0% Cost of Goods Sold 28,35,000.00 52.5% 59.5% Gross Profit 25,65,000.00 47.5% 40.5% Selling Expenses 14,04,000.00 26.0% 23.0% Administrative Expenses 8,10,000.00 15.0% 13.0% Total Operating Expenses 22,14,000.00 41.0% 36.0% Income from Operations 3,51,000.00 6.5% 4.5% Other Income 3,15,000.00 5.8% 2.0% Total Income 6,66,000.00 12.3% 6.5% Other Expense 68,000.00 1.3% 1.3% Income before Tax 5,98,000.00 11.1% 5.2% Income Tax expense 74,000.00 1.4% 1.4% Net Income 5,24,000.00 9.7% 3.8%Related Questions
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