Calculate the gross margin percentage, Accounting Basics

Assignment Help:

Q. Calculate the gross margin percentage?

Calculate the gross margin percentage by using the following formula

Grossmargin percentage = Grossmargin/Net sales

To show the use of this ratio considers the following information from the 2000 Annual Report of Abercrombie & Fitch.

($ millions)                              2000                                        1999                            1998

Revenues                                 $ 1,238.6                            $ 1,030.9                          $ 805.2

Gross profit                             509.4                                       450.4                          331.4

Gross profit (margin)

Percentage   $509.5/$1,238.6 = 41.13%   $450.4/$1,030.9=43.69%      $331.4/$805.2= 1.16%

Abercrombie's gross margin held at a relatively high 41-43 percent over those three years. You must now understand the distinction between accounting for a service company and a merchandising company. The next section persist the discussion of merchandise inventory carried by merchandising companies.


Related Discussions:- Calculate the gross margin percentage

First-in first-out inventory, Q. First-in first-out inventory? FIFO (fi...

Q. First-in first-out inventory? FIFO (first-in first-out): Ending inventory contains of the most recent purchases. FIFO presumes that the costs of the first goods purchased ar

Explain the economic logic, Suppose a firm owns oil well assets. It is deci...

Suppose a firm owns oil well assets. It is deciding how much oil to extract from its oil wells this year and next year. Production of oil costs $10 per barrel this year; next year,

Prepaid expenses and deferred charges, Q. Prepaid expenses and deferred cha...

Q. Prepaid expenses and deferred charges? Prepaid expenses, deferred charges -- assets already paid for, which are being used up or willexpire. Insurance paid for in advance is

Prepare financial statements, Accounting information systems' output is req...

Accounting information systems' output is required by external and internal users for decision making. you are required to use the following trial balance to prepare financial stat

Interest calculations, Calculate the amount of interest for each of the f...

Calculate the amount of interest for each of the following independent situations (assume 365 days per year):             a)

Explain about lower-of-cost-or-market method, Q. Explain about lower-of-cos...

Q. Explain about lower-of-cost-or-market method? The lower-of-cost-or-market (LCM) method is the inventory costing method that values inventory at the lower of its historical c

Career in taxation, A career in taxation is by no signifies limited to publ...

A career in taxation is by no signifies limited to public accounting. for the reason that there are so many types of taxes impacting so many aspects of our lives tax specialists ac

Applied research project, I just want part A and Part B including ppt slide...

I just want part A and Part B including ppt slides to present.

Inventory or incidental cost, While perusing medical practice, is the cost ...

While perusing medical practice, is the cost of supplies, for patients on site, considered as an inventory, or an incidental cost? With 2 million in sales the chemotherapy medicine

Amount of stockholders'' equity, At the starting of the year, Hernandez Com...

At the starting of the year, Hernandez Company had total assets of $872,310 and total liabilities of $497,500. (a) If total assets enhanced $147,320 during the year and total li

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd