Refer to the following trial balance. Debit Credit Cash $5,000 Accounts receivab
ID: 2595814 • Letter: R
Question
Refer to the following trial balance.
Debit
Credit
Cash
$5,000
Accounts receivable
14,000
Inventory
20,000
Supplies
5,000
Land
100,000
Accounts payable
$3,000
Notes payable
25,000
Smith, Capital
90,000
Smith, Withdrawals
1,000
Sales revenues
160,000
Sales returns and allowances
2,000
Sales discounts
3,000
Cost of goods sold
80,000
Salaries expense
5,000
Utility expense
23,000
Rent expense
18,000
Interest expense
2,000
Totals
$278,000
$278,000
How much is the gross profit?
How much is the gross profit?
Debit
Credit
Cash
$5,000
Accounts receivable
14,000
Inventory
20,000
Supplies
5,000
Land
100,000
Accounts payable
$3,000
Notes payable
25,000
Smith, Capital
90,000
Smith, Withdrawals
1,000
Sales revenues
160,000
Sales returns and allowances
2,000
Sales discounts
3,000
Cost of goods sold
80,000
Salaries expense
5,000
Utility expense
23,000
Rent expense
18,000
Interest expense
2,000
Totals
$278,000
$278,000
Explanation / Answer
D.$75,000.
Gross profit = sales revenue - sales discount - sales returns and allowances - cost of goods sold
=>$160,000 - 3,000 - 2,000 - 80,000
=>$75,000.
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