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# General Farms Inc, Cassy Beauty Company: depreciation expens

1. General Farms, Inc. had sales of \$750,000, cost of goods sold of \$200,000, selling and administrative expense of \$70,000, and operating profit of \$150,000. What was the value of depreciation expense?
2. Cassy Beauty Company had sales of \$320,000 and cost of goods sold of \$112,000. What is the gross profit margin (ratio of gross profit to sales)?
3. A company has operating profit of \$210,000 after deducting lease payments of \$30,000. Interest expense is \$50,000. What is the firm's fixed charge coverage?
4. If a company has a 10% profit margin and sales and accounts payable both increase by \$10,000, then the amount of new funds required will decline, True or False?

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Your tutorial is attached in Excel along with two references. The ...

#### Solution Summary

Your tutorial is attached in Excel along with two references. The multi-step income statements are created for you to illustrate how to solve these. The ratio and the analysis for the funds needed are plotted out for you. Example amounts are given to give you a visual as well as an explanation.

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