General Limited's income statement reported the following for last year: $$\begin{array} { | l | r | }
\hline \text { Sales revenue } & \$ 881,000 \
\hline \text { Cost of goods sold } & 573,000 \
\hline \text { Expenses } & 129,000 \
\hline \text { Net income } & 179,000 \
\hline
\end{array}$$ Which of the following statements is correct about the income statement?

Question

General Limited's income statement reported the following for last year: $$\begin{array} { | l | r | } 
\hline \text { Sales revenue } & \$ 881,000 \
\hline \text { Cost of goods sold } & 573,000 \
\hline \text { Expenses } & 129,000 \
\hline \text { Net income } & 179,000 \
\hline
\end{array}$$ Which of the following statements is correct about the income statement?

Quizplus · Accepted Answer

To calculate the gross profit percentage, we divide the gross profit by the sales revenue and multiply by 100. 
Gross profit = Sales revenue - Cost of goods sold = $881,000 - $573,000 = $308,000 
Gross profit percentage = (Gross profit / Sales revenue) x 100 = ($308,000 / $881,000) x 100 = 34.96%

General Limited's Income Statement Reported the Following for Last Year