Accounting 0452 · IGCSE · Interpretation of accounting ratios

Interpretation of accounting ratios — practice question

A business gave the following details about its gross margin. Year 1: $40\%$ Year 2: $38\%$ Year 3: $35\%$ What might account for the changes in gross margin?

  • ACost of sales is decreasing.
  • BExpenses are decreasing.
  • CQuantity of goods sold is decreasing.
  • DSelling price is decreasing.

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