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

Management, briefly explain management process

briefly explain management process

Trade, 1. Whate are the challenges faced in trade and solutions those probl...

1. Whate are the challenges faced in trade and solutions those problems?

Trading and profit and loss account, state why carriage inwards is stated o...

state why carriage inwards is stated on the trading account

Show adjustments for deferred items, Q. Show Adjustments for deferred items...

Q. Show Adjustments for deferred items? This segment discusses the two types of adjustments for deferred items asset/expense adjustments and liability/revenue adjustments. In t

Financial statements of business organizations, Q. Financial statements of ...

Q. Financial statements of business organizations? Business entities may perhaps have many objectives and goals. For instance one of your objectives in owning a physical fitnes

Analyzing and using the financial results, The two fundamental sources of e...

The two fundamental sources of equity in a company are stockholders and creditors their combined interests are called total equities. To discover the equity ratio divide stockholde

Please help, A client comes to you for investment advice on his $500,000 wi...

A client comes to you for investment advice on his $500,000 winnings from the lottery. He has been offered the following options by three different financial institutions and reque

Samuel, what is the implication of applying accounting concept wrongly

what is the implication of applying accounting concept wrongly

Accounting standards, The fundamental concepts, discussed in the previous p...

The fundamental concepts, discussed in the previous paragraphs, are the core components in the theory of accounting. Such concepts as postulates or conventions, although, permit a

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