Question

            Using the financial statements for Tootsie Roll Industries (2019) please answer the following questions. (Link copied Below)

a.         What was the profit margin for each of the last three years? Comment on any trend.

b.         What was the gross profit ratio in each of the last three years? Comment on any trend.

***Use total revenue as a base in each of these calculations (as “net sales”). Further, for net income, use Net Earnings attributable to Tootsie Rolls Industries, Inc.

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Answer 1

		2017		2018		2019
profit margin	net income/total revenue	15.57%		10.96%		12.32%
net income		80864		56893		64920
total revenue		519289		518920		527113
profit margin is showing a declining trend in net income available to equity shareholders in year 2018 and a recovery is seen in year 2019 over the year 2018 but it is below the level of 2017.
		2017		2018		2019
Gross profit margin	Gross profit/total revenue	36.96%		36.26%		37.38%
Gross profit		191906		188173		197016
total revenue		519289		518920		527113
A slight decline in gross profit margin is noticed in year 2018 but a rise is seen into year 2019, so gross profit percentage has increased over the year 2017 and 2018