Gross Profit equals

Question

Gross Profit equals

Quizplus · Accepted Answer

Gross Profit is calculated as the difference between total sales revenue and the cost of goods sold. Therefore, the correct formula for Gross Profit is Sales - Sales Returns and Allowances - Sales Discounts - Cost of Goods Sold (Option B). Option A is incorrect as it deducts "Other Expenses" instead of just deducting returns, allowances, and discounts. Option C is incorrect because it only deducts "Other Expenses" from the cost of goods sold, instead of all expenses. Option D is incorrect because it only deducts operating expenses from the cost of goods sold, instead of sales returns, allowances, and discounts.

Gross Profit Equals