$$\begin{array} { l c c }
& & \text { March } 2018 \
\text { Finished goods purchases }&& \$ 35000\
\text { Cost of goods manufactured } & & 80000\
\text { Sales } & & 220000\
\
\text { Inventories } & 1 \text { March 18 } & 31 \text { March 18 } \
\text { Raw materials } & \$ 20000 & \$ 24000 \
\text { Work in process } & 28000 & 32000 \
\text { Finished goods } & 180000 & 190000
\end{array}$$ Gross profit for the month of March 2018 is:

Question

$$\begin{array} { l c c } 
 & & \text { March } 2018 \
\text { Finished goods purchases }&& \$ 35000\
\text { Cost of goods manufactured }  & & 80000\
\text { Sales }  & & 220000\
 \
\text { Inventories } & 1 \text { March 18 } & 31 \text { March 18 } \
\text { Raw materials } & \$ 20000 & \$ 24000 \
\text { Work in process } & 28000 & 32000 \
\text { Finished goods } & 180000 & 190000
\end{array}$$ Gross profit for the month of March 2018 is:

Quizplus · Accepted Answer

To calculate the gross profit for March 2018, we first need to determine the cost of goods sold (COGS). The formula for COGS is:$$ \text{COGS} = \text{Opening Inventory of Finished Goods} + \text{Cost of Goods Manufactured} - \text{Closing Inventory of Finished Goods} $$Given data:- Opening Inventory of Finished Goods = $180,000- Cost of Goods Manufactured = $80,000- Closing Inventory of Finished Goods = $190,000$$ \text{COGS} = 180,000 + 80,000 - 190,000 = 70,000 $$Next, we calculate the gross profit using the formula:$$ \text{Gross Profit} = \text{Sales} - \text{COGS} $$Given data:- Sales = $220,000- COGS = $70,000$$ \text{Gross Profit} = 220,000 - 70,000 = 150,000 $$However, there seems to be a mistake in my calculation as none of the options match the result. Let's correct the approach considering the purchases of finished goods as well, which should also be added to the cost of goods available for sale:$$ \text{COGS} = \text{Opening Inventory of Finished Goods} + \text{Cost of Goods Manufactured} + \text{Finished Goods Purchases} - \text{Closing Inventory of Finished Goods} $$$$ \text{COGS} = 180,000 + 80,000 + 35,000 - 190,000 = 105,000 $$$$ \text{Gross Profit} = \text{Sales} - \text{COGS} = 220,000 - 105,000 = 115,000 $$Therefore, the correct calculation for gross profit is $115,000, which matches option C.

Gross Profit for the Month of March 2018 Is: A)

Gross Profit for the Month of March 2018 Is:
A)