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2 years ago

15

In the exact moment you run out of laundry detergent and realize you need to pick some up at the store, you are in the ________

stage of the buying decision process.

1 answer:

shutvik [7]2 years ago

3 0

In the exact moment you run out of laundry detergent and realize you need to pick some up at the store, you are in the problem recognition stage of the buying decision process. The problem recognition stage is realizing you have to make the purchase versus deciding to make the purchase of something.

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Local co. has sales of $ 10.6 million and cost of sales of $ 5.6 million. its selling, general and administrative expenses are

Afina-wow [57]

Given: Sales/Revenue = $10.6 million

Cost of goods sold = $5.6 million

General and administrative expenses = $550,000

Research and development expenses = $1.1 million

Annual depreciation = $1.3 million

Tax rate = 35%

Find: gross margin, operating margin and net profit margin

Solutions:

a) The Gross Margin is 47.2%

Gross Margin = (Revenue - Cost of Goods Sold)/Revenue

$10.6 million –$ 5.6 million = $5,000,000

$5,000,000/$10,600,000 = 0.4716 or 47.2%

b) The Operating Profit Margin is 72.2%

Operating Profit Margin = Operating Income / Sales Revenue

*Get first the total amount of operating income

Operating income = Gross Profit – General and Administrative Expenses – Research and Development – Depreciation

Operating income = $10,600,000 - $550,000 - $1,100,000 - $1,300,000

Operating income = $7,650,000

*Then get the operating margin

Operating margin = $7,650,000 / $10,600,000

Operating margin = 0.7216 or 72.2%

c) The net profit margin is 46.9%

Net Profit Margin = Net Income/ Total Revenues

*Get first the total amount of Net Income

Net Income = Total Revenues – Total Expenses

Net Income = $10,600,000 - $550,000 - $1,100,000 - $1,300,000 x (1-0.35) <span>
Net Income = $7,650,000 x (1-0.35)</span>

Net Income = $4,972,500

*Then get the Net Profit Margin

Net Profit Margin = $4,972,500/$10,600,000

<span>Net Profit Margin = 0.4691 or 46.9%</span>

5 0

2 years ago

The 2021 income statement of Adrian Express reports sales of $19,310,000, cost of goods sold of $12,250,000, and net income of $

yanalaym [24]

Answer:

1.

Average Collection Period = 25.2 Days

Average Days In Inventory = 52.1 days

Current Ratio = 2.2 to 1

Debt to Equity Ratio = 88.5%

2.

The above ratios shows that Adrian Express is more risky than the Industry Average due to Debt to Equity Ratio which is worse than 50% of Industry Average, although the rest 3 ratios are much closer to industry average.

Explanation:

$Average Collection Period =\frac{365}{Accounts Receivables Turnover Ratio}$

$Accounts Receivables Turnover Ratio = \frac{Net Credit Sales}{Average Accounts Receivables}\\\\Net Credit Sales = 19,310,000\\Accounts Receivables In 2021 = 1,600,000\\Accounts Receivables In 2020 = 1,100,000$

$Accounts Receivables Turnover Ratio = \frac{19310000}{\frac{1600000 + 1100000}{2} }\\Accounts Receivables Turnover Ratio = \frac{19310000}{1350000}\\Accounts Receivables Turnover Ratio = 14.30 times$

$Average Collection Period =\frac{365}{14.30 times}\\Average Collection Period = 25.52 days$

The Average Collection Period is greater than the market average hence worse.

$Average Days In Inventory = \frac{365}{Inventory Turnover}$

$Inventory Turnover = \frac{CostOfGoodsSold}{Average Inventories}$

$Inventory Turnover = \frac{12250000}{\frac{2000000 + 1500000}{2}}$

$Inventory Turnover = \frac{12250000}{1750000}$

$Inventory Turnover = 7 times$

$Average Days In Inventory = \frac{365}{7 times}$

$Average Days In Inventory = 52.14 days$

The Average Days in Inventory is less than the Industry average hence good.

$Current Ratio = \frac{Current Assets}{Current Liabilities}$

$Current Assets = Cash + Accounts Receivable + Inventory$

$Current Assets = 700,000 + 1,600,000 + 2,000,000$

$Current Assets = 4,300,000$

$Current Liabilities = 1,920,000$

$Current Ratio = \frac{4300000}{1920000}$

$Current Ratio = 2.24 to 1$

Current Ratio is greater than Industry Average hence the Adrian Express is risky.

$Debt To Equity Ratio = \frac{Total Liabilities}{Total Equity}$

$Total Liabilities = Current Liabilities + Long Term Liabilities\\Total Liabilities = 1,920,000 + 2,400,000\\Total Liabilities = 4,320,000$

$Total Equity = Common Stock + Retained Earnings\\Total Equity = 1,900,000 + 2,980,000\\Total Equity = 4,880,000$

$Debt To Equity Ratio = \frac{4320000}{4880000}$

$Debt To Equity Ratio = 88.5$ %

Debt To Equity Ratio is greater than Industry Average, hence Adrian Express is risky as compared to Industry Average.

7 0

2 years ago

Green Planet Corp. has (a) 5,000 shares of noncumulative 10% preferred stock with a $2 par value and (b) 17,000 shares of common

lana66690 [7]

Answer:

Year 1

PS $800 CS $0

Year 2

PS $1,000 CS $700

Explanation:

5,000 x $2 x 10% = $1,000 preferred dividends

when distribution of dividends occurs the preferred have preference over common. They get paid first.

Year 1:

the 800 dollars will go entirely to preferred

Year 2:

the preferred stock receive their 1,000

the remaining 700 dollars will go to common stock holders.

7 0

2 years ago

Uan recently completed 20 years of service in the army. during this time, he managed to save a little money and is entitled to a

bixtya [17]

<span>keep it small, especially in the beginning

Small businesses die when you expand too quickly in the beginning</span>

3 0

2 years ago

Freight Terms Determine the amount to be paid in full settlement of each of two invoices, (a) and (b), assuming that credit for

frozen [14]

Answer:

A

Explanation:

3 0

2 years ago

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