Question

[The following information applies to the questions displayed below.] Campus Stop, Inc., is a student co-op. Campus Stop uses a perpetual inventory system. The following transactions (summarized) have been selected for analysis: a. Sold merchandise for cash (cost of merchandise $152,070). $ 275,000 b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) for cash refund (original cost of merchandise $800). 1,600 c. Sold merchandise (costing $9,000) to a customer on account with terms n/30. 20,000 d. Collected half of the balance owed by the customer in (c). 10,000 e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid. 1,800 Compute the gross profit percentage. (Round your answer to 1 decimal place.)

Answer 1

Answer: 45%

Explanation:

First calculate the sales:

= Cash sales + credit sale

= 275,000 + 20,000

= $295,000

Terms on credit sale was 2/10 n/30 and they paid half in time($10,000) but a partial allowance of $1,800 was granted:

Net sales would be:

= Sales - sales returns - sales discount

= 295,000 - 1,600 - (10,000 * 2%) - 1,800

= $291,400

COGS = 152,070 + 9,000 - 800

= $160,270

Gross profit percentage = (Sales - Cost of goods sold) / Sales

= (291,400 - 160,270) / 291,400 * 100%

= 45%