The gross margin amount in 2017 for the Billings Corporation totaled $800,000.If cost of goods sold is 80% of sales, how much is sales?

Question

Quizplus · Accepted Answer

Gross margin is calculated as Sales - Cost of Goods Sold (COGS). Given that COGS is 80% of sales, this means gross margin is 20% of sales. Therefore, if the gross margin amount is $800,000, which represents 20% of sales, the total sales would be $800,000 / 0.2 = $4,000,000.

The Gross Margin Amount in 2017 for the Billings Corporation