Asked by Logan Jordan on May 01, 2024
Verified
What is the amount of gross profit for Fernandez Co.?
A) $7,175,000
B) $1,335,000
C) $3,510,000
D) $2,162,000
Gross Profit
The difference between sales revenue and the cost of goods sold, before deducting operating expenses, interest, and taxes.
Fiscal Year
A 12-month period used for accounting purposes and planning by organizations, which may not align with the calendar year.
Ledger
A comprehensive collection of a company's financial transactions, divided into individual accounts, and recorded in a way that balances are always maintained across assets, liabilities, and equity.
- Evaluate and scrutinize pivotal financial measures like closing retained earnings, operational profit, and gross income.
Verified Answer
LA
Lucky AtwalMay 04, 2024
Final Answer :
C
Explanation :
To calculate gross profit, we need to subtract cost of goods sold from net sales.
Net sales = $12,850,000 - $1,275,000 - $1,360,000 = $10,215,000
Cost of goods sold = $5,705,000
Gross profit = $10,215,000 - $5,705,000 = $4,510,000
Therefore, the correct option is C.
Net sales = $12,850,000 - $1,275,000 - $1,360,000 = $10,215,000
Cost of goods sold = $5,705,000
Gross profit = $10,215,000 - $5,705,000 = $4,510,000
Therefore, the correct option is C.
Learning Objectives
- Evaluate and scrutinize pivotal financial measures like closing retained earnings, operational profit, and gross income.