Question

julius operates an athletic apparel store. his records indicate that he had sales of $97,000. customers returned $2,000 worth of clothing and shoes because of various reasons. his cost of goods sold was $25,000. what is julius's schedule c (form 1040) gross profit?

Answer 1

Julius' Schedule C (Form) gross profit would be $47,000

Define gross profit.

Your gross profit is the selling price of your items less their production costs. It is your service's selling price less the time and labor expenses incurred to complete the work for a service-based firm. Gross profit is another phrase for total sales, often known as revenue or turnover, less total sales expenses.

To determine gross profit, sales money is reduced from the direct costs of bringing the product to market. Net profit is calculated as sales revenue minus all business expenses. In both business and accounting, net income is an entity's revenue less the cost of goods sold, costs, depreciation and amortization, interest, and taxes for a given accounting period.

Given:

Gross income = Sales - returned goods - costs of goods sold

$97,000 - $25,000 - $2,000 = $70,000;

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