Question

# Refer to the following mentioned data. (In millions) 2017 2016 2015 Net sales \$ 34,110 \$...

Refer to the following mentioned data.

 (In millions) 2017 2016 2015 Net sales \$ 34,110 \$ 30,196 \$ 26,986 Cost of products sold 14,428 13,938 13,437 Gross margin \$ 19,682 \$ 16,258 \$ 13,549

Required:
a.
Calculate the gross profit ratio for each of the past three years. (Round your answers to 2 decimal places.)

2017 %

2016 %

2015 %

b. Assume that Campbell’s net sales for the first four months of 2018 totaled \$12.83 billion. Calculate an estimated cost of goods sold and gross profit for the four months, using the gross profit ratio for 2017. (Round intermediate calculations to 2 decimal places. Enter your answers in millions rounded to nearest whole number (i.e., 5,000,000 should be entered as 5).)

cost of goods sold

gross profit

Gross Profit ratio is obtained by dividing Gross profit by sales

Gross profit= sales-cost of goods sold

2015

=(\$16,549/\$26,986) *100

=61.32%

2016

(\$16,258/\$30,196)*100

=53.84%

2017

(\$19,682/\$34,110)*100

=57.70%

b.2017 GP ratio = 57.70%

1 billion = 1000 million

12.83 billion = ? million

Sales =12,830 Million

Gross Profit = sales*GP ratio

=\$12,830*57.70%

Gross profit=\$7,403 Million (Rounded to nearest whole number)

Cost of goods sold = Sales-Gross Profit

\$12,830-\$7,403

Cost of Goods Sold=\$5,427

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