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    HELP11218's Avatar
    HELP11218 Posts: 5, Reputation: 1
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    #1

    Mar 10, 2009, 07:12 PM
    Gross Profit Rate
    In the company sales were 480,000 sales returns and allowances were 30,000 and cost of goods sold was 288,000. The gross profit rate was:

    a.64%
    b.36%
    c.40%
    d.60%
    ROLCAM's Avatar
    ROLCAM Posts: 1,420, Reputation: 23
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    #2

    Mar 11, 2009, 02:24 AM

    company sales $ 480,000
    LESS
    sales returns and allowances were $30,000

    sub total equals $ 450,000
    LESS
    cost of goods $ 288,000

    sub total = gross margin equals $162,000

    PROFIT RATE = 162,000/450,000

    PROFIT RATE = 36%

    The answer is B.
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