Question

The gross margin is determined as follows. Sales 700,000 Cost of goods sold(100,000 + 220,000) 320,000 Gross margin380,000. What is the gross margin?

Answer 1

The gross margin is calculated as sales minus the cost of goods sold, which results in a gross margin of $380,000.

Step-by-step explanation:

The gross margin is calculated by subtracting the cost of goods sold from the sales. In this case, the sales amount to $700,000, and the cost of goods sold is a total of $320,000, which is the sum of $100,000 and $220,000. Therefore, the gross margin can be calculated as:

Sales - Cost of Goods Sold = Gross Margin

$700,000 - $320,000 = $380,000

Thus, the gross margin is $380,000.