Cheri's Beauty Products Ltd. reported the figures below at December 31, 2020, 2019 and 2018. The business
Question:
Cheri's Beauty Products Ltd. reported the figures below at December 31, 2020, 2019 and 2018. The business has declared bankruptcy. You have been asked to review the business and explain why it failed.{Requirement}
Evaluate the trend of Cheri's Beauty Products's results of operations during 2018 through 2020. Consider the trends of sales, gross profit, and net income. Track the gross profit percentage (to three decimal places) and the rate of inventory turnover (to one decimal place) in each year-2018, 2019, and 2020. The ending inventory value for 2017 is \(\$ 7.0\). Also, discuss the role that selling expenses must have played in Cheri's Beauty Products's difficulties.
Step by Step Answer:
Financial Accounting
ISBN: 9780135433065
7th Canadian Edition
Authors: Walter Harrison, Wendy Tietz, C. Thomas, Greg Berberich, Catherine Seguin