Problem - Gross Profit Percent and Markup Percent

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Problem - Gross Profit Percent and Markup Percent

Caterpillar Inc. (CAT) produces and sells various types of equipment, including tractors, loaders, and mining equipment. The following data (in millions) were adapted from recent financial statements of Caterpillar.

 

Year 2

Year 1

Sales

$55,184

$55,656

Cost of goods sold

(40,391)

(41,454)

Gross profit

$14,793

$14,202

Required -

1. Compute the gross profit percent for Years 1 and 2. Round to one decimal place.

2. Compute the average markup percent for Years 1 and 2. Round to one decimal place.

3. Compare the results in parts (1) and (2) for Years 1 and 2. Comment on your comparison.

Reference no: EM132710699

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