What ratio should a retailer use to best compare the performance of cashmere sweaters versus cotton sweaters?
A) Cost of goods sold percent
B) Gross margin percent
C) Operating expense percent
D) Fixed expense percent
E) Variable expense percent

Question

Quizplus · Accepted Answer

Gross margin percentage is gross margin divided by net sales. Retailers use this ratio to compare (1) the performance of various types of merchandise and (2) their own performance with that of other retailers with higher or lower levels of sales.

What Ratio Should a Retailer Use to Best Compare the Performance