Presented below is financial information for two different companies.
|Summer Company||Winter Company|
|Sales revenue||$96,710||$ (d)|
|Sales returns||$ (a)||$7,000|
|Cost of goods sold||54,920||(e)|
a) Determine the missing amounts.
b) Determine the gross profit rates.
The operating expenses is an additional expense other than the cost of the goods which is incurred by the company in doing the business operation of the company. These are expenses that cannot be directly associated to a specific product.
Answer and Explanation:
Net Sales = Sales Revenue - Sales Returns
Gross Profit = Net Sales - Cost of Goods Sold
Net Income = Gross Profit - Operating Expenses
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Learn more about this topic:
from Introduction to Business: Homework Help ResourceChapter 22 / Lesson 43