O-LevelAccountingAnalysis and interpretation7707/12 · May/June 2018 · Q291 Mark

A business provided the following information. | | 2016 % | 2017 % | |:---|:---|:---| | gross profit/sales | 40 | 30 | | net profit/sales | 8 | 10 | What may have caused the change in the net profit/sales ratio?

Aexpenses have decreased

Bexpenses have increased

Cthe percentage of expenses to sales has decreased

Dthe percentage of expenses to sales has increased

✓ Correct answer

C: the percentage of expenses to sales has decreased

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Topic: Analysis and interpretation, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source: O-Level Accounting, May/June 2018 Paper 1 Variant 2, question 29.

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