Question

Andrea’s Fashions sold merchandise for $190,000 cash during the month of July. Returns that month totaled...

Andrea’s Fashions sold merchandise for $190,000 cash during the month of July. Returns that month totaled $4,000. If the company’s gross profit rate is 40%, Andrea’s will report monthly net sales revenue and cost of goods sold of

A. $190,000 and $114,000

B. $186,000 and $74,400

C. $186,000 and $111,600

D. $190,000 and $111,600

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Homework Answers

Answer #1

Answer : $186,000 and $111,600

proof :

Net sales Revenue = Sales - Sales return

                              = 190,000 - 4000

Net sales Revenue = 186,000

Cost of goods sold = Net sales Revenue - Gross profit

Gross profit             = 186,000 * 0.40 = 74,400

Cost of goods sold = 186,000 - 74,400

Cost of goods sold =   111,600

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