Use the following selected information from Farris, LLC to determine the Year 2 and Year 1 trend percents for cost of goods sold using Year 1 as the base.
A) 36.4% for Year 2 and 41.1% for Year 1.
B) 55.0% for Year 2 and 56.0% for Year 1.
C) 119.4% for Year 2 and 100.0% for Year 1.
D) 117.2% for Year 2 and 100.0% for Year 1.
E) 65.1% for Year 2 and 64.6% for Year 1.

Question

Quizplus · Accepted Answer

To calculate the trend percent for Year 2, we use the formula: 
Year 2 trend percent = (Year 2 amount ÷ Year 1 amount) × 100%
Plugging in the values given:
Year 2 trend percent = (Cost of goods sold for Year 2 ÷ Cost of goods sold for Year 1) × 100%
Year 2 trend percent = ($2,015,000 ÷ $1,721,000) × 100%
Year 2 trend percent = 117.2%
To calculate the trend percent for Year 1 using Year 1 as the base, the answer will always be 100%. Therefore, the Year 1 trend percent given in the question is correct, and we can see that only answer choice D matches both trend percents.

Use the Following Selected Information from Farris, LLC to Determine