Towpath Tennis & Recreation's operating activities for the year are listed below. $$\begin{array} { | l | r | }
\hline \text { Purcheses } & \$ 150,000 \
\hline \text { Operating expenses } & 62,000 \
\hline \text { Bepinging inventory } & 27,000 \
\hline \text { Ending inventory } & 32,000 \
\hline \text { Sales revenue } & 302,000 \
\hline
\end{array}$$
- What is the gross profit for the year?
A)$157,000
B)$152,000
C)$ 90,000
D)$302,000

Question

Towpath Tennis & Recreation's operating activities for the year are listed below. $$\begin{array} { | l | r | } 
\hline \text { Purcheses } & \$ 150,000 \
\hline \text { Operating expenses } & 62,000 \
\hline \text { Bepinging inventory } & 27,000 \
\hline \text { Ending inventory } & 32,000 \
\hline \text { Sales revenue } & 302,000 \
\hline
\end{array}$$
- What is the gross profit for the year?
A)$157,000
B)$152,000
C)$ 90,000
D)$302,000

Quizplus · Accepted Answer

Gross profit is calculated as sales revenue minus the cost of goods sold. The cost of goods sold is calculated as beginning inventory plus purchases minus ending inventory. Therefore, the gross profit for the year is $302,000 - ($27,000 + $150,000 - $32,000) = $157,000.

Towpath Tennis & Recreation's Operating Activities for the Year Are