Fundamentals of Financial Accounting 4th Edition by Fred Phillips,Robert Libby,Patricia Libby

Exercise 17

This year your company has purchased less expensive merchandise inventory but has not changed its selling prices. What effect will this change have on the company's gross profit percentage this year, in comparison to last year
A) The ratio will not change.
B) The ratio will increase.
C) The ratio will decrease.
D) Cannot determine.