Problem Solving

BTGmoderatorDC wrote:The annual stockholders' report for Corporation X stated that profits were up 10 percent over the previous year, although profits as a percent of sales were down 10 percent. Total sales for that year were approximately what percent of sales for the previous year?

A. 78%
B. 90%
C. 110%
D. 122%
E. 190%



OA D

OA Official Guide

Profits = Sales - Cost (Let us excludes taxes etc)

let us consider Profits from previous year = 100. So consider Sales = 150 and Cost - 50

Given profits are up 10% in current year from previous year. So profits in the current year = 110.

So profits as % of sales for previous year is 100/150*100 ≈ 67%

Given that profits as % of sales in current year have reduced by 10%. i.e ≈ 57%

calculating for Sales of the current year = profit of current year/Sales of current year * 100 = profits as % of sales for current year

= (110/x)*100 = 57
= x (Sales of current year) = 110/57 * 100 ≈193

Question asked is sales of current year as % sales previous year = 193/150 *100 ≈ 128%. Closest answer is 122%

So the Answer is D.

So