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In 1999, Company X's gross profit was what percent of its

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In 1999, Company X's gross profit was what percent of its [#permalink] New post 14 Apr 2006, 12:49
00:00
A
B
C
D
E

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  55% (hard)

Question Stats:

44% (01:56) correct 56% (00:37) wrong based on 18 sessions
In 1999, Company X's gross profit was what percent of its revenue?

(1) In 1999 Company X's gross profit was 1/3 of its expenses
(2) In 1999 Company X's expenses were 3/4 of its revenue.
[Reveal] Spoiler: OA
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 14 Apr 2006, 13:06
In 1999, Company X's gross profit was what percent of its revenue?
1. In 1999 Company X's gross profit was 1/3 of its expenses
2. In 1999 Company X's expenses were 3/4 of its revenue.

Let's remember that gross profit equals revenue - expenses.

Statement 1: GP = 1/3 E
GP = R - E
GP = R - 3GP
R = 4GP

Therefore, Gross profit is 1/4 of revenues.

Statement 2: E = 3/4R
GP = R - E
GP = R - 3/4R
GP = 1/4R

Sufficient.

Answer is D.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 14 Apr 2006, 13:53
But jcgoodchild, can we just assume that gross profit = revenue - expenses?

Realistically, what if the company had say an amortization charge? If GMAC wants us to use this formula, won't they actually display it next to the question? Because accordingly the answer would be D or C.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 14 Apr 2006, 14:27
Well, I would be surprised if they didn't tell you in question how to get gross profit. However, even in real life, amortization charges are not applied to gross profit, they are applied to net profit. Gross profit is simply revenue minus all costs related to generating that revenue.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 25 May 2006, 20:26
In 1999 Company X's gross profit was what percent of its revenue?

(1) In 1999 Company X’s gross profit was 1/3 of its expenses.
(2) In 1999 Company X’s expenses were 3/4 of its revenue.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 25 May 2006, 20:56
I would say D

P-Profit
R- Revenue
E- Expense

R =P + E

from first P =1/3* E so R = 4/3 *E from this we can find the percentage

from second E = 3/4 * R so P =1/4 * R From this we can find the percentage

so D
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 25 May 2006, 20:58
I am getting C on this one

let profit = P
revenue = R
Expenses = E


so from question stem, P = what % of R
--> P = x%of R

From 1.

P= E/3 => not sufficient

From II

E = 3R/4 => not sufficient

Together

P = R/4

which means R/4 = x/100 * R

x = 25

so sufficient C
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 25 May 2006, 21:01
ipc302 wrote:
I would say D

P-Profit
R- Revenue
E- Expense

R =P + E

from first P =1/3* E so R = 4/3 *E from this we can find the percentage

from second E = 3/4 * R so P =1/4 * R From this we can find the percentage

so D


Got the same. Agree! with ipc's solution
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 25 May 2006, 21:20
I see the error in my calc....nice job
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 25 May 2006, 22:52
D,

1) P = R - E

Given P = 1/3 E hence can find the gross profit was what percent of its revenue?

2) P = R- E

Given E = 3/4R

Hence can find the percent.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 26 May 2006, 01:40
D it is. GP + Expense = Revenue.

Since we need a ratio of GP/Revenue, we need not know actually value of GP/Expense. We need to get one ratio between two of the any three variables.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 25 Dec 2007, 19:46
In 1999, Company X's gross profit was what percent of its revenue?

1. In 1999, Company X's gross profit was 1/3 of its expenses.

2. In 1999, Company X's expenses were 3/4 of its revenue

~parsifal
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 25 Dec 2007, 20:57
parsifal wrote:
In 1999, Company X's gross profit was what percent of its revenue?

1. In 1999, Company X's gross profit was 1/3 of its expenses.
2. In 1999, Company X's expenses were 3/4 of its revenue

~parsifal


D.

1. gp = (1/3) e
e = 3gp
r = e + gp
r = 3gp + gp
r = 4gp

gp/r = gp/4gp = 1/4 = 25%.. suff.

2. e = (3/4) r
gp = r - e
gp = r - (3/4)r
gp = (1/4)r

again gp/r = 25%.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 25 Dec 2007, 23:19
parsifal wrote:
In 1999, Company X's gross profit was what percent of its revenue?

1. In 1999, Company X's gross profit was 1/3 of its expenses.

2. In 1999, Company X's expenses were 3/4 of its revenue

~parsifal


D.

Stat 1:
Expenses = x
GP = 1/3x
Rev. = x-1/3x = 2/3x
Suff.

Stat 2"
Rev. = x
Exp. = 3/4x
GP = x-3/4x
Suff.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 26 Dec 2007, 17:20
same approach as above, and same answer ... D
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 02 Aug 2008, 16:20
this question, from gmatprep, seems pretty nasty to me:

In 1999, Company X's gross profit was what percent of its revenue?

1. In 1999, Company X's gross profit was 1/3 of its expenses.

2. In 1999, Company X's expenses were 3/4 of its revenue

I could have easily guessed the correct answer, but no where does it strictly state that GP=Rev-Expenses
I thought this was a trick question so I selected E since no formulaic information was given...does anyone else agree that this question is bogus? Now when I take the test, I may keep second-guessing myself about if I'm making too many assumptions, or not enough assumptions.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 02 Aug 2008, 16:55
the question is tricky, but it is technically correct.

"gross" Profit = Revenue - Expense is the standard

"net" profit is where you might have to figure in taxes.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 02 Aug 2008, 20:16
young_gun wrote:
this question, from gmatprep, seems pretty nasty to me:

In 1999, Company X's gross profit was what percent of its revenue?

1. In 1999, Company X's gross profit was 1/3 of its expenses.

2. In 1999, Company X's expenses were 3/4 of its revenue

I could have easily guessed the correct answer, but no where does it strictly state that GP=Rev-Expenses
I thought this was a trick question so I selected E since no formulaic information was given...does anyone else agree that this question is bogus? Now when I take the test, I may keep second-guessing myself about if I'm making too many assumptions, or not enough assumptions.


This question does not require any formula of profit and loss or revenue and expenses.Just we got to treat this as a set of equations :
Question:p=x(r) x=? p=profit r=revenue

consider (1) : p=1/3 * e but here we cant get relation between e and r hence does not answer =>insufficient

consider (2) : e=3/4 * r => this does not solve since we dont know hows e related to p again =>? insufficient
consder (1) and (2) => p=1/3*e and e=3/4 * r =>
p = 1/3 * 3/4 * r => hence x=1/4 => sufficient

IMO C
I hope no where we require actual formulae and stuff here it uses a direct linear relation between variables
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 09 Aug 2009, 02:22
I got this question in gmatprep test today

In 1999 Company X's gross profit was what percent of its revenue?

A) In 1999 Comapny X's gross profit was 1/3 of its expenses.
B) In 1999 Company X's expenses were 3/4 of its revenue.
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Re: In 1999, Company X's gross profit was what percent of its [#permalink] New post 09 Aug 2009, 03:01
My answer is D. you can easily find Profit-Revenue relationship from both statements.
Re: In 1999, Company X's gross profit was what percent of its   [#permalink] 09 Aug 2009, 03:01
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