Shelcal Ltd provides the following data for the year 2016: $$\begin{array} { | l | l | }
\hline \text { Sales revenue } & \$ 430,000 \
\hline \text { Sales returns and allowances } & 1300 \
\hline \text { Sales discounts } & 830 \
\hline \text { Net sales revenue } & \$ 427,870 \
\hline \text { Cost of sales } & \$ 259,000 \
\hline
\end{array}$$ On a vertical analysis report,cost of sales as a percentage of net sales will amount to:
A)60.72%
B)60.53%
C)60.23%
D)60.84%

Question

Shelcal Ltd provides the following data for the year 2016: $$\begin{array} { | l | l | } 
\hline \text { Sales revenue } & \$ 430,000 \
\hline \text { Sales returns and allowances } & 1300 \
\hline \text { Sales discounts } & 830 \
\hline \text { Net sales revenue } & \$ 427,870 \
\hline \text { Cost of sales } & \$ 259,000 \
\hline
\end{array}$$ On a vertical analysis report,cost of sales as a percentage of net sales will amount to:
A)60.72%
B)60.53%
C)60.23%
D)60.84%

Quizplus · Accepted Answer

Cost of sales as a percentage of net sales is calculated as (Cost of Sales / Net Sales Revenue) * 100. So, (259,000 / 427,870) * 100 = 60.53%.

Shelcal Ltd Provides the Following Data for the Year 2016