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    rodriguezd77's Avatar
    rodriguezd77 Posts: 2, Reputation: 1
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    #1

    Nov 26, 2013, 11:58 AM
    Finding gross profit
    Abbey Co. sold merchandise to Gomez Co. on account, $35,000, terms 2/15, net 45. The cost of merchandise sold is $24,500. Abbey Co. issued a credit memo for $3,600 for merchandise returned that originally cost $1,700. Gomez Co. paid the invoice within the discount period. What is the amount of gross profit earned by Abbey Co. on the above transactions?
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Nov 26, 2013, 02:33 PM
    Take your sales of $35,000 minus the returned merchandise of $3,600 to get your net sales.

    Net take your cost of merchandise of $24,500 minus the cost of merchandise returned of $1,700 to get your net cost of merchandise sold.

    Now simply take your net sales minus your net cost of merchandise sold to get your gross profit.
    rodriguezd77's Avatar
    rodriguezd77 Posts: 2, Reputation: 1
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    #3

    Nov 26, 2013, 02:58 PM
    gross profit = $8600?

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