Sales revenue equals $367,810,sales returns & allowances are $10,000,and sales discounts total $14,180.The cost of goods sold is $216,490,operating expenses are $28,500,and the company incurs $31,640 of income tax expense.Which of the following statements is correct?
A) Net sales equal $343,630 and gross profit is $98,640.
B) Net sales equal $67,000 and gross profit is $98,640.
C) Net sales equal $343,630 and gross profit is $127,140.
D) Net sales equal $367,810 and gross profit is $67,000.

Question

Quizplus · Accepted Answer

First, we need to calculate the net sales:
Net Sales = Sales Revenue - Sales Returns & Allowances - Sales Discounts
Net Sales = $367,810 - $10,000 - $14,180
Net Sales = $343,630

Next, we can calculate the gross profit:
Gross Profit = Net Sales - Cost of Goods Sold
Gross Profit = $343,630 - $216,490
Gross Profit = $127,140

Therefore, the correct statement is that net sales equal $343,630 and gross profit is $127,140, which is option C.

Sales Revenue Equals $367,810,sales Returns & Allowances Are $10,000,and Sales