Acc280 Financial Accounting: E5-7 Financial information is presented (Iwig and Pratt Company)

Acc280 Financial Accounting
E5-7
Financial information is presented here for two companies.
Iwig Company Pratt Company
Sales 90,000
Sales returns 5,000
Net sales 84,000 100,000
Cost of goods sold 56,700
Gross profit 40,000
Operating expenses 14,580
Net income 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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