Thompson's 2016 gross profit ratio is:
A)25%.
B)19%.
C)20%.
D)None of the above is correct.

Name: Thompson's 2016 gross profit ratio is: A)25%. B)19%. C)20%. D)None of the above is correct.
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Question

Quizplus · Accepted Answer

Gross profit ratio = (Gross profit / Net sales) x 100%
Gross profit = Net sales - Cost of goods sold
From the information given, we can calculate:
Gross profit = $400,000 - $320,000 = $80,000
Gross profit ratio = ($80,000 / $400,000) x 100% = 20%

Thompson's 2016 Gross Profit Ratio Is