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The gross profit ratio for Pelham Inc. increased from 45% in 2020 to 50% in 2021. Which of the following must be true?

Question

The gross profit ratio for Pelham Inc. increased from 45% in 2020 to 50% in 2021. Which of the following must be true?
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Solution 1

The gross profit ratio is a financial metric that indicates a company's financial health by revealing the proportion of money left over from revenues after accounting for the cost of goods sold. It is calculated as (Gross Profit / Revenue) * 100.

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