If ABC Corporation has net sales of $600,000 and cost of goods sold of $390,000, the gross profit percentage is:
A) 65%.
B) 54%.
C) 35%.
D) 25%.

Question

Quizplus · Accepted Answer

The formula for gross profit percentage is:

Gross profit percentage = (Gross profit / Net sales) x 100

where gross profit is calculated as:

Gross profit = Net sales - Cost of goods sold

Given: 
Net sales = $600,000 
Cost of goods sold = $390,000

Using the formula:

Gross profit = $600,000 - $390,000 = $210,000

Gross profit percentage = ($210,000 / $600,000) x 100 = 35%

Therefore, the best choice is C, with an explanation as shown above.

If ABC Corporation Has Net Sales of $600,000 and Cost