Which one of the following statements is false regarding the gross profit ratio?
A) The gross profit ratio is calculated by dividing net sales by gross profit.
B) The gross profit ratio is a measure of profitability.
C) The gross profit ratio can help investors decide whether or not to buy a company's stock.
D) The gross profit ratio should be compared with both a company's prior years' ratios and also competitor ratios.
Correct Answer:
Verified
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