Question

Consider ratios: financial information is presented below: find gross profit. operating expenses $ 45,000 sales returns and allowances $ 13,000 sales discounts $ 6,000 sales $150,000 cost of goods sold $ 67,000 $77,000. $64,000. $83,000. $70,000.

Answer 1

Gross Profit is calculated by deducting the cost of goods sold, sales return and sales discount from the sales. The operating expenses is not considered for gross profit. The same is deducted from the gross profit for finding the net profit.

Gross Profit = Sales - Cost of goods sold - Sales Return - Sales Discount

Gross Profit = $150,000 - $67,000 - $13,000 - $6,000

Gross Profit = $150,000 - $86,000

Gross Profit = $ 64,000

Thus, gross profit is $64,000