Question

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The following data were provided by Mystery Incorporated for the year ended December 31:

Cost of Goods Sold	$	156,000
Income Tax Expense		15,120
Merchandise Sales (gross revenue) for Cash		222,000
Merchandise Sales (gross revenue) on Credit		38,400
Office Expenses		18,100
Sales Returns and Allowances		6,510
Salaries and Wages Expense		36,600

1. 2-a. What was the amount of gross profit?

2. 2-b. What was the gross profit percentage? (Round your percentage to 1 decimal place.)

Answer 1

	Answer
	Income Statement:
	Revenue
	Sales on cash		$      222,000
	Sales on credit		$        38,400
	Total		$      260,400
	Less: Sales return		$          6,510
	Net sales revenue		$      253,890
	Expenses
	Cost of good ssold	$      156,000
	Office expenses	$        18,100
	Salaries and wages expenses	$        36,600
	Total expenses		$      210,700
	Net income before tax		$        43,190
	Less: Income tax		$        15,120
	After tax income		$        28,070
2-a	Gross profit (sales - COGS)			$     97,890
2-b	(253890-156000)
	Gross profits Ratio (GP/ Sales)			38.6%