Question

Newark Company has provided the following information: Cash sales, $540,000 Credit sales, $1,440,000 Selling and administrative expenses, $420,000 Sales returns and allowances, $99,000 Gross profit, $1,450,000 Increase in accounts receivable, $64,000 Bad debt expense, $42,000 Sales discounts, $52,000 Net income, $1,030,000 How much are Newark's net sales?
A. $ 307,000
B. $ 252,000
C. $ 440,000
D. $ 340,000

Answer 1

Answer:

$1,829,000

Explanation:

The computation of the net sales is shown below:

= Cash sales + credit sales - Sales returns and allowances - Sales discounts

= $540,000 + $1,440,000 - $99,000 - $52,000

= $1,829,000

We simply added the cash sales and the credit sales so that the total sales come after that the sales returns and the sales discount is deducted in order to determine the net sales

This is the answer but the same is not provided in the given options