Which of the following statements about the Gross Margin Ratio are correct?
1. It measures the percentage of revenue retained after covering the cost of goods sold (COGS).
2. A higher gross margin ratio always indicates better financial performance.
3. Comparisons across industries using the gross margin ratio are not recommended.
1
1 and 2 only
2
2 and 3 only
3
1 and 3 only
4
All of the above
5
None of the above