The vertical analysis statement of Bateman,Inc.is as shown below:

The figure 47.0% shown for gross profit in 2017 signifies that the gross profit is ________.
A)equal to 47.0% of net income
B)increased by 47.0% over the previous year
C)47.0% of net sales revenue
D)47.0% of cost of goods sold

Question

The vertical analysis statement of Bateman,Inc.is as shown below:

The figure 47.0% shown for gross profit in 2017 signifies that the gross profit is ________.
A)equal to 47.0% of net income 
B)increased by 47.0% over the previous year 
C)47.0% of net sales revenue 
D)47.0% of cost of goods sold

Quizplus · Accepted Answer

The figure 47.0% shown for gross profit in 2017 signifies that the gross profit is 47.0% of net sales revenue, as vertical analysis expresses each line item as a percentage of net sales revenue. Therefore, the answer is C.

The Vertical Analysis Statement of Bateman,Inc