Accounting: What the Numbers Mean 11th edition:

Solution for Chapter 9, Problem 10E

C4 ou past wee years. ume that Campbell's net sales for the first four months of 2015 totaled 7 billion. Calculate an estimated cost of goods sold and gross profit for the A Assume that four months. ulate gross profit, cost of goods sold, and selling price MBI, Inc., had of $600 million for fiscal 2016. The company's gross profit ratio for that year Exercise 9.10 LO 2, 3 sales of $600 m was 31.2%. Required: Calculate the gross profit and cost of goods sold for MBI, Inc., for fiscal 2016. h Assume that a new product is developed and that it will cost $1,634 to manu- facture. Calculate the selling price that must be set for this new product if its gross profit ratio is to be the same as the average achieved for all products for fiscal 2016. c. From a management viewpoint, what would you do with this information? Operating income versus net income If you were interested in evaluating the prof. itability of a company and could have only limited historical data, would you prefer to know operating income or net income for the past five years? Explain your answer. Exercise 9.1 LO 5 Operating income versus net income Refer to the selected financial data (five-year Exercise 9. financial summary) in the Campbell Soup Company annual report in the appendix. LO 5 Required: ere the trend of the operating income (earnings before interest and taxes) data with and of net income (net earnings attributable to Campbell Soup Company) data from rough 2014. Which series of data is more meaningful? Explain your answer. Campbells