-In the judgment of the credit analysts of Oakbrook Company, what issue would be of most concern or source of optimism?
A) Income taxes increased 18.3 percent.
B) There was a 10.0 percent increase in income before taxes.
C) There was a 26.5 percent increase in cost of goods sold with only an 15.3 percent increase in sales.
D) Miscellaneous expense decreased 33.3 percent.

Question

-In the judgment of the credit analysts of Oakbrook Company, what issue would be of most concern or source of optimism?
A) Income taxes increased 18.3 percent. 
B) There was a 10.0 percent increase in income before taxes. 
C) There was a 26.5 percent increase in cost of goods sold with only an 15.3 percent increase in sales. 
D) Miscellaneous expense decreased 33.3 percent.

Quizplus · Accepted Answer

Cost of goods sold, the major cost category is increasing faster than sales. This is a source of concern.

-In the Judgment of the Credit Analysts of Oakbrook Company