Problem 2-3 Gross profit [LO2-1] Swank Clothiers had sales of $385,000 and cost of goods sold of $297,000. a. What is the gross profit margin (ratio of gross profit to sales)? (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.) Gross profit margin % b. If the average firm in the clothing industry had a gross profit of 20 percent, how is the firm doing? The firm is
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First, we need to calculate the gross profit. Gross profit is calculated as sales minus cost of goods sold. So, in this case, gross profit is $385,000 - $297,000 = $88,000. Show more…
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