OMM 622 Week 3 Discusssion 1.docx

101 budget committees a part of any organization

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in sales numbers (p. 101). Budget committees a part of any organization would simply need to see more details from the accounting periods to figure out the exact reason why there might be an upward trend. Whether it is an increase or decrease in sales numbers, there has to be a cause. The cause depends on various factors and is unique to each and every organization. Furthermore, lets briefly discuss gross profit. G ross profit is taken before tax and other indirect costs. It would be the difference between net sales and cost of goods sold. Epstein (2014) explains, “Gross Profit shows whether the company made a profit from selling its products or services before considering the expenses of operating the company” (p. 117). An increase in the GP may be due to an increase in the selling price of goods sold without any increase in the cost of goods sold or a decrease in cost of goods sold without any decrease in selling price; However, a decrease in the gross profit could be due to a decrease in the selling price of goods, without any decrease in the cost of goods sold or an increase in the cost of goods sold without any increase in selling price. References Epstein, L. (2014). Financial decision making: An introduction to financial reports [Electronic version]. Retrieved from Expert Bulletin. (2015). Gross Profit Ratio: Gross Profit Margin Analysis. Retrieved January 8, 2019, from - margin-analysis
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  • Spring '14
  • Revenue, Sales, Generally Accepted Accounting Principles, Epstein, gross profit margin

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