Final answer:
The missing Sales amount for Arquette Company is $470,000 and the Gross Profit is $180,000, making option (a) correct. The Sales figure is calculated by adding Net Sales and Sales Returns and Allowances, while Gross Profit is the difference between Sales and the sum of Cost of Goods Sold and Sales Returns and Allowances.
Step-by-step explanation:
The subject of this question is Business, and it pertains to the financial accounting concepts of sales, cost of goods sold (COGS), sales returns, allowances, and gross profit. To find the missing amounts of Sales and Gross Profit for Arquette Company, the provided information can be used:
- To calculate Net Sales, you subtract Sales Returns and Allowances from Sales.
- Gross Profit is derived from Net Sales minus Cost of Goods Sold.
Given that we know Net Sales equals $450,000 and Sales Returns and Allowances are $20,000, we can determine Sales by adding those two figures together:
Sales = Net Sales + Sales Returns and Allowances = $450,000 + $20,000 = $470,000.
Then, using the calculated Sales figure to find Gross Profit:
Gross Profit = Sales - (Cost of Goods Sold + Sales Returns and Allowances) = $470,000 - ($270,000 + $20,000) = $180,000.
Therefore, the missing amounts are:
Sales: $470,000
Gross Profit: $180,000
The correct answer is (a) $470,000 Sales and $180,000 Gross Profit.