Nu Company reported the following pre-tax data:

Net Sales 2800
Cost of Goods available for sale 2500
Operating Expenses 880
Effective tax rate 40%
Ending Inventories:
If LIFO is elected 820
If FIFO is elected 1060


1. What is Nu's gross profit percentage if it elects LIFO?
2. Wat is Nu's net income if it elects FIFO? LIFO?

To answer this question, you just need to keep the following formula in mind:

Costs of Goods Available for Sale - Ending Inventory = Cost of Goods Sold

If you don't understand the formula, please ask for an explanation.

You can now take your Sales less COGS to get Gross Profit, and then subtract your Operating Expenses to get Net Income. If you want to show your work, we can check it for you.

After doing the calculations taking the sales less the gross profit minus the operating expenses, how do you determine the gross profit percentage?