Financial information is presented below: $\begin{array}{lr}
\text { Operating Expenses } & \$ 92,800 \
\text { Sales Returns and Allowances } & 18,000 \
\text { Sales Discounts } & 12,000 \
\text { Sales Revenue } & 350,000 \
\text { Cost of Goods Sold } & 176,000
\end{array}$ Gross profit would be
A) $51200.
B) $144000.
C) $156000.
D) $174000.

Question

Quizplus · Accepted Answer

Gross profit is calculated as Sales Revenue minus Cost of Goods Sold. Therefore, Gross Profit = $350,000 - $176,000 = $174,000. However, Sales Returns and Allowances ($18,000) and Sales Discounts ($12,000) must be subtracted from Sales Revenue before calculating Gross Profit. Adjusted Sales Revenue = $350,000 - $18,000 - $12,000 = $320,000. Thus, Gross Profit = $320,000 - $176,000 = $144,000.

Financial Information Is Presented Below Gross Profit Would Be A) $51200

Financial Information Is Presented Below Gross Profit Would Be
A) $51200