Sales revenue is $367,810 while sales returns and allowances and sales discounts total $24,180.The cost of goods sold is $216,490,operating and other expenses are $28,500,and the company pays $31,640 in income tax.Which of the following is true?

Question

Quizplus · Accepted Answer

First, we need to calculate the net sales by subtracting the sales returns and allowances and sales discounts from the sales revenue:

Net sales = Sales revenue - (Sales returns and allowances + Sales discounts) 
Net sales = $367,810 - ($24,180) 
Net sales = $343,630

Next, we can calculate the gross profit by subtracting the cost of goods sold from the net sales:

Gross profit = Net sales - Cost of goods sold 
Gross profit = $343,630 - $216,490 
Gross profit = $127,140

Therefore, the correct answer is C: Net sales is $343,630 and gross profit is $127,140.

Sales Revenue Is $367,810 While Sales Returns and Allowances and Sales