Fill in the missing amounts. Crane Company Sheridan Company
Sales revenue $94,200 $enter a dollar amount Sales returns and allowances enter a dollar amount $ 3,000 Net sales 80,200 100,000 Cost of goods sold 54,200 enter a dollar amount Gross profit $enter a subtotal of the two previous amounts 50,000 Operating expenses 14,700 enter a dollar amount Net income $enter a total net income 15,600
Calculate the profit margin and the gross profit rate for each company. (Round answers to 1 decimal place, e. g. 15.5%. )
Crane Company Sheridan Company
Profit margin
Gross profit rate
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Find my analysis below

Explanation:

The gross profit rate is the portion of net sales earned as gross profit prior to considering operating expenses as indicated by the formula below:

gross profit rate=gross profit/net sales

The profit margin measures the net income as a percentage of net sales

profit margin=net income/net sales

                                Crane companySheridan company

Sales revenue                 $94,200  $103,000  

sales returns and allowance  $14,000  $3,000  

Net sales                           $80,200  $100,000  

cost of goods sold                  $54,200  $50,000  

Gross profit                               $26,000  $50,000  

Operating expenses            $14,700  $34,400  

Net income                            $11,300  $15,600  

Gross profit rate=gross profit /net sales32.4%50.0%

Profit margin=net income/net sales         14.1%15.6%

Crane companySheridan company

Sales revenue                 94200=F5+F4

sales returns and allowance  =E3-E53000

Net sales                       80200100000

cost of goods sold              54200=F5-F7

Gross profit                       =E5-E650000

Operating expenses        14700=F7-F9

Net income                            =E7-E815600

Gross profit rate=gross profit /net sales=E7/E5=F7/F5

Profit margin=net income/net sales=E9/E5=F9/F5

answer; functional fixedness;