can you help me solve this thanks very much. OBJ.1 EX 6-1 Determining gross prof

Question

can you help me solve this thanks very much.

OBJ.1 EX 6-1 Determining gross proft During the current year, merchandise is sold for $31,850,000. The cost of the merchandise sold is $24,206,000. a. What is the amount of the gross profit? b. Compute the gross profit percentage (gross profit divided by sales). Will the income statement necessarily report a net income? Explain. C. EX6-2 Determining cost of merchandise sold OBJ.1 -For a Tecent year, Best Buy reported sales of $40,339 million. Its gross profit was $9,0 million. What was the amount of Best Buy's cost of merchandise sold? profit was $9,047

Explanation / Answer

Solution: 6-1)

1) Gross profit = 31,850,000 - 24,206,000 = 7,644,000

2) Gross profit Percentage = 7,644,000 / 31,850,000 = 24%

3) Income statement should not necessarily report a net income. The gross profit is mere the difference among the selling price and the cost of goods sold where as numerous other operating and non-operating expenses/ income are incurred during a financial year which may cause net loss to the concern

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