Question

Gross billings for merchandise sold by lang company to its customers last year amounted to $11,720,000; sales returns and allowances were $370,000, sales discounts were $175,000, and freight-out was $140,000. Net sales last year for lang company were select one:
a. $11,350,000.
b. $11,035,000.
c. $11,175,000.
d. $11,720,000.

Answer 1

Calculation of Net sales last year for Lang Company:

It is given that Gross billings for merchandise sold by Lang Company to its customers last year amounted to $11,720,000; sales returns and allowances were $370,000, sales discounts were $175,000.

Net sales can be calculated using the following formula;

Net Sales = Sales –Sales Returns –Allowances

=  $11,720,000-$370,000-$175,000

= $11,175,000

Hence the Net sales last year for Lang Company is $11,175,000

Hence the correct asnwer is c. $11,175,000.