Answer and Explanation:
The balances of the following items are as follows;
Inventory ($500,000 + $300,000 - $5,000) $795,000
Sales ($1,000,000 + $800,000 - $180,000) $1,620,000
Cost of goods sold ($500,000 + $900,000 + $5,000 - $180,000) $725,000
Operating expenses ($230,000 + $300,000 + ($78,000 ÷ 4 years) $549,500
Net income attributable to noncontrolling interest ($100,000 × 10% - $19,500 × 10% - $5,000 × 10% ) $7,550
The $5,000 comes from
= ($180,000 - $130,000) × 10%
= $5,000
Answer:
Gross profit percentage = Gross profit / Net sales
= (Net sales - COGS) / Net sales
= (250,000 - 150,000) / 250,000
= 40%
Return on sales ratio = EBIT / Net sales
= (Gross profit + other income - Administrative expenses - Other expense - Selling expenses) / Net sales
= (250,000 - 150,000 + 15,000 - 10,000 - 10,000 - 50,000) / 250,000
= 18%
<u>With new product:</u>
Gross profit percentage = Gross profit / Net sales
= (Net sales - COGS) / Net sales
= (250,000 + 45,000 - 150,000 - 38,000) / (250,000 + 45,000)
= 36.3%
Return on sales ratio = EBIT / Net sales
= (Gross profit + other income - Administrative expenses - Other expense - Selling expenses) / Net sales
= (250,000 + 45,000 - 150,000 - 38,000 + 15,000 - 10,000 - 10,000 - 50,000) / (250,000 + 45,000)
= 52,000 / 295,000
= 17.6%
