 # Question & Answer: Use the below information to calculate the (a) net sales, (b) gross profit, (c) total operating expenses, and (d) net income…..

Use the below information to calculate the (a) net sales, (b) gross profit, (c) total operating expenses, and (d) net income

Sales returns  \$700, Rent expense \$1,288, Sales discounts \$950, Depreciation expense \$600, Cost of merchandise sold \$7600, Gross sales \$20,900, Advertising expense \$1,650, Salary expense \$2,900, Heat expense \$900

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Question & Answer: Use the below information to calculate the (a) net sales, (b) gross profit, (c) total operating expenses, and (d) net income…..
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Net sales is = Gross sales – Sales returns – Sales discount

That is = \$ 20,900 – \$ 700 – \$950 = \$ 19,250/-

Gross proit is = Net sales – Cost of goods sold

That is = \$ 19,250 – \$ 7,600 = \$ 11,650/-

Total operating expenses = Rent expenses + Heat expenses + salary Expense + depreciation expenses + advertising expenses = \$ 1288+\$900+\$2900+\$600+\$1650

Total operating expenses = \$ 7,388/-

Net income is = Gross profit – Operating expenses

Net income is = 11650-7388 =is \$ 4,262/-.