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  • Company A Has Better Control in Cost Than Company B

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    1. The document analyzes financial data from Company A (Central Retail Corporation) and Company B (CP ALL). It finds that Company A has a higher gross profit and better control of costs of goods sold. 2. It also calculates the profit margins for each company and determines that Company A has a slightly higher profit margin of 7.42% compared to 7.10% for Company B, indicating that Company A has better profitability. 3. The percentage changes in net sales and net income from 2017 to 2018 are also provided. Company A saw increases of 7.48% in net sales and 69.52% in net income, while Company B had increases of 10.80% in net

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    1. The document analyzes financial data from Company A (Central Retail Corporation) and Company B (CP ALL). It finds that Company A has a higher gross profit and better control of costs of goods sold. 2. It also calculates the profit margins for each company and determines that Company A has a slightly higher profit margin of 7.42% compared to 7.10% for Company B, indicating that Company A has better profitability. 3. The percentage changes in net sales and net income from 2017 to 2018 are also provided. Company A saw increases of 7.48% in net sales and 69.52% in net income, while Company B had increases of 10.80% in net

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    © All Rights Reserved
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    5 views2 pages

    Company A Has Better Control in Cost Than Company B

    Uploaded by

    zZl3Ul2NNINGZz
    1. The document analyzes financial data from Company A (Central Retail Corporation) and Company B (CP ALL). It finds that Company A has a higher gross profit and better control of costs of goods sold. 2. It also calculates the profit margins for each company and determines that Company A has a slightly higher profit margin of 7.42% compared to 7.10% for Company B, indicating that Company A has better profitability. 3. The percentage changes in net sales and net income from 2017 to 2018 are also provided. Company A saw increases of 7.48% in net sales and 69.52% in net income, while Company B had increases of 10.80% in net

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    of 2

    Class Activity Chapter 5

    1. Calculate the gross profit of Company A and Company B and discuss their relative abilities to
    control cost of goods sold.

    Company A = Central Retail Corporation Public Company Limited


    Company B = CP ALL PUBLIC COMPANY LIMITED

    Company A’s revenue from sale of goods = 180,614,271,656 Baht


    Company A’s cost of sales of goods = 129,936,550,236 Baht
    Company A’s gross profit = 50,677,721,420 Baht

    Company B’s revenue from sale of goods = 308,843,148,532 Baht


    Company B’s cost of sales of goods = 223,145,672,130 Baht
    Company B’s gross profit = 85,697,476,402 Baht

    Company A has better control in cost than Company B.

    2. Calculate the profit margin, and discuss the companies' relative profitability.

    Company A = Central Retail Corporation Public Company Limited


    Company B = CP ALL PUBLIC COMPANY LIMITED

    Company A’s net income = 13,405,545,960 Baht


    Company A’s net sales = 180,614,271,656 Baht
    Company A’s profit margin = 7.42 %

    Company B’s net income = 21,924,330,775 Baht


    Company B’s net sales = 308,843,148,532 Baht
    Company B’s profit margin = 7.10 %

    Company A has better profitability than Company B.

    3. What was the percentage change in net sales and in net income from the year ended 31
    December 2017 to 2018.

    Company A = Central Retail Corporation Public Company Limited


    Company B = CP ALL PUBLIC COMPANY LIMITED

    Company A’s 2017 net sales = 168,043,223,400 Baht


    Company A’s 2018 net sales = 180,614,271,656 Baht
    Percentage change in net sales = 7.48 %
    Company A’s 2017 net income = 7,907,967,323 Baht
    Company A’s 2018 net income = 13,405,545,960 Baht
    Percentage change in net income = 69.52 %

    Company B’s 2017 net sales = 278,751,086,839 Baht


    Company B’s 2018 net sales = 308,843,148,532 Baht
    Percentage change in net sales = 10.80 %

    Company B’s 2017 net income = 18,180,739,040 Baht


    Company B’s 2018 net income = 21,924,330,775 Baht
    Percentage change in net income = 20.60 %

    4. Determine the following values of each company: profit margin, gross profit, gross profit rate,
    operating income percentage change in operating income from 2017 to 2018 of your Company
    A and Company B. Then, response to what conclusion concerning the relative profitability of the
    two companies can be drawn from those data?

    Company A = Central Retail Corporation Public Company Limited


    Company B = CP ALL PUBLIC COMPANY LIMITED

    Company A’s profit margin = 7.42 %


    Company A’s gross profit = 50,677,721,420 Baht
    Company A’s 2018 net sales = 180,614,271,656 Baht
    Company A’s gross profit rate = 28.06 %
    Percentage change in net income = 69.52 %

    Company B’s profit margin = 7.10 %


    Company B’s gross profit = 85,697,476,402 Baht
    Company B’s 2018 net sales = 308,843,148,532 Baht
    Company B’s gross profit rate = 27.75 %
    Percentage change in net income = 20.60 %

    In conclusion, Company A has better overall profitability than Company B.

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