What are estimated net sales for 2010,assuming the sales return/gross sales relationship remains constant?

Question

Quizplus · Accepted Answer

Net sales = Gross sales - Sales returnsGross sales = Net sales / (1 - Sales return rate)Sales return rate = Sales returns / Gross salesAssuming the sales return/gross sales relationship remains constant, we can use the sales return rate from 2009 to estimate net sales for 2010.Sales return rate = 20,000 / 600,000 = 0.0333Net sales = Gross sales / (1 - Sales return rate)Net sales = 600,000 / (1 - 0.0333) = $646,893

What Are Estimated Net Sales for 2010,assuming the Sales Return/gross