Answer:
Gross profit=15,000-9,375=$5,625
Explanation:
Gross profit can be calculated by the any corporation as follows:
Gross profit: Sales- Cost of sales
In given scenario, sales and cost of sales can be determined as follows:
Sales=Number of LF units sold by Jermaine Dye Corporation*sale price per unit of LF
=1,000*15=$15,000
The corporation is selling LF for 15$ which is 3 times the price at which it is selling 1B and assuming that the entity is earning same gross profit margin on both products, then cost of sales can be determined as follows:
Lets say that cost of one unit of "1B" is "z" then the cost of one unit of "LF" will be "3z" and following equation can be formed for cost of sales:
3,000(3z)+7,000(z)=50,000
9000z+7000z=50,000
16,000z=50,000
z=$3.125(50,000/16,000)=cost of one unit of 1B
Cost for one unit of LF=3*3.125=$9.375
Cost of sales for 1,000 units=9.375*1000=$9,375
Gross profit=15,000-9,375=$5,625
