Financial information is presented here for two companies. King Queen Company Company Sales $90,000 ? Sales returns

Question:

Financial information is presented here for two companies.

King Queen Company Company Sales $90,000 ?

Sales returns ? $ 5,000 Net sales 81,000 100,000 Cost of goods sold 56,700 ?

Gross profit ? 38,000 Operating expenses 14,580 ?

Net income 2 18,000 Instructions

(a) Fill in the missing amounts. Show all computations.

(b) Calculate the profit margin ratio and the gross profit rate for each company.

(c) Discuss your findings in part (b).

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