Gross profit is calculated as:
A)Total sales - Cost of sales - Selling,general,and administrative expenses - Depreciation and amortization.
B)Total sales - Cost of sales - Selling,general,and administrative expenses.
C)Total sales - Cost of sales.
D)Total sales - Cost of sales - Interest expense.
E)Total sales - Cost of sales - Interest expense -Taxes.

Question

Quizplus · Accepted Answer

Gross profit is calculated by subtracting the cost of sales from total sales, which means that only option C provides the correct calculation for gross profit. Selling, general, and administrative expenses (option B) and depreciation and amortization (option A) are not included in the calculation of gross profit. In addition, interest expense (option D) and taxes (option E) are not part of the calculation for gross profit.

Gross Profit Is Calculated As