Peartree Inc. provides the following extracts from income statement for the year 2015: $$\begin{array} { | l | r | }
\hline \text { Net sales } & \$ 500,000 \
\hline \text { Cost of Goods Sold } & ( 150,000 ) \
\hline \text { Gross profit } & \$ 350,00 \
\hline
\end{array}$$ Calculate the gross profit percentage.

Question

Peartree Inc. provides the following extracts from income statement for the year 2015: $$\begin{array} { | l | r | } 
\hline \text { Net sales } & \$ 500,000 \
\hline \text { Cost of Goods Sold } & ( 150,000 ) \
\hline \text { Gross profit } & \$ 350,00 \
\hline
\end{array}$$ Calculate the gross profit percentage.

Quizplus · Accepted Answer

Gross profit percentage is calculated as Gross profit/Net sales x 100%. Thus, Gross profit percentage = (350,000/500,000) x 100% = 70%. Therefore, the best choice is B.

Peartree Inc Calculate the Gross Profit Percentage