Gross Profit and Business Implementation

The gross profit rate of the entrepreneurial venture is computed by

dividing the cost of goods sold by net sales.

• TRUE

• FALSE

The gross profit rate provides information on the cost ratio of the

business.

• TRUE

• FALSE

In evaluating the profitability of the entrepreneurial venture, the

evaluation must focus on the information reflected on the face of the

balance sheet.

• TRUE

• FALSE

. The operating profit margin rate indicates information on the

percentage of operating expenses on the net sales.

• TRUE

• FALSE

Mr. Q is a practicing Doctor of Medicine. During the month of March

2019, he received Professional Fees amounting to P 1,000,000 and

total expenses of P250,000. The net income of Mr. Q is P 750,000.

• TRUE

• FALSE

Profit is the money received from the customer in exchange of

products given to customer.

• TRUE

• FALSE

The gross profit rate of the entrepreneurial venture is computed by

dividing the cost of goods sold by net sales.

• TRUE

• FALSE

The gross profit rate provides information on the cost ratio of

the business.

• TRUE

• FALSE

One of the objectives in evaluating the gross profit rate of the

business is to determine whether the amount of the gross profit is

sufficient to cover the operating expenses.

• TRUE

• FALSE

The operating profit margin rate indicates information on the

percentage of operating expenses to net sales.

• TRUE

• FALSE