Question

Given the information below, what is the gross profit?Sales revenue....................... $32,0000Accounts receivable............ 50,000Ending inventory................... 100,000Cost of goods sold............... 250,000Sales Returns....................... 20,000a. $250,000.b. $70,000.c. $220,000.d. $50,000.

Answer 1

Answer:

Option (D) is correct.

Explanation:

Given that,

Sales revenue = $32,0000

Accounts receivable = 50,000

Ending inventory = 100,000

Cost of goods sold = 250,000

Sales Returns = 20,000

Gross profit:

= Net sales revenue - Cost of goods sold

= (Sales revenue - Sales return) - Cost of goods sold

= ($320,000 - $20,000) - $250,000

=  $300,000 - $250,000

= $50,000