Question

Write True if the statement is correct & write False if you think the answer is not correct. 1. The gross profit rate of the entrepreneurial venture is computed by dividing the cost of goods sold by net sales. 2. The gross profit rate provides information on the cost ratio of the business. 3. In evaluating the profitability of the entrepreneurial venture the evaluation must focus on the information reflected on the face of the balance sheet. 4. The operating profit margin rate indicates information on the percentage of operating expenses on the net sales. 5. Mr. Q is a practicing Doctor of Medicine. During the month of March 2019 he received Professional Fees amounting to P 1,000,000 and total expenses of P250,000. The net income of Mr. Q is P 750,000. 6. Profit is the money received from customer in exchange of products given to customer. 7. The gross profit rate of the entrepreneurial venture is computed by dividing the cost of goods sold by net sales. 8. The gross profit rate provides information on the cost ratio of business. 9. One of the objectives in evaluating the gross profit rate of the business is to determine whether the amount of the gross profit is sufficient to cover the operating expenses. 10. The operating profit margin rate indicates information on the percentage of operating expenses to net sales. 11 The government is not interested in financial statements since it is not a party to any of the transactions of the business. 12. The net profit margin rate presents the general perspective of the operating performance of the business. 13. The amount of income per peso investment can be determined by computing the net profit margin rate. 14.In normal situation, it is favorable for the business to have high inventory 15. Preparation & presentation of the financial statements of the entity is the primary responsibility of an accountant.

Write True if the statement is correct & write False if you think the answer is not
correct.
1. The gross profit rate of the entrepreneurial venture is computed by
dividing the cost of goods sold by net sales.
2. The gross profit rate provides information on the cost ratio of the
business.
3. In evaluating the profitability of the entrepreneurial venture the
evaluation must focus on the information reflected on the face of the
balance sheet.
4. The operating profit margin rate indicates information on the
percentage of operating expenses on the net sales.
5. Mr. Q is a practicing Doctor of Medicine. During the month of March
2019 he received Professional Fees amounting to P 1,000,000 and
total expenses of P250,000. The net income of Mr. Q is P 750,000.
6. Profit is the money received from customer in exchange of
products given to customer.
7. The gross profit rate of the entrepreneurial venture is computed by
dividing the cost of goods sold by net sales.
8. The gross profit rate provides information on the cost ratio of
business.
9. One of the objectives in evaluating the gross profit rate of the
business is to determine whether the amount of the gross profit is
sufficient to cover the operating expenses.
10. The operating profit margin rate indicates information on the
percentage of operating expenses to net sales.
11 The government is not interested in financial statements since it is
not a party to any of the transactions of the business.
12. The net profit margin rate presents the general perspective of the
operating performance of the business.
13. The amount of income per peso investment can be determined by
computing the net profit margin rate.
14.In normal situation, it is favorable for the business to have high
inventory
15. Preparation & presentation of the financial statements of the entity is
the primary responsibility of an accountant.

Added by Mark C.

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