Question

Harrison and company is a leading retailer of casual apparel for men, women, and children. Assume that you are employed as a stock analyst and your boss has just completed a review of the new Harrison annual report. She provided you with her notes, but they are missing some information that you need. Her notes show that the ending inventory for Harrison in the current and previous years was $272,402,000 and $233,133,000, respectively. Net sales for the current year were $2,540,276,000. Cost of goods sold was $178,604,000. Income before taxes was $172,155,000. What is the gross profit for Harrison in the current year?

1) $2,361,672,000
2) $2,361,672,000
3) $2,361,672,000
4) $2,361,672,000

Answer 1

The gross profit for Harrison in the current year is calculated by subtracting the cost of goods sold ($178,604,000) from the net sales ($2,540,276,000), which equals $2,361,672,000.

Step-by-step explanation:

To calculate the gross profit for Harrison in the current year, we need to subtract the cost of goods sold (COGS) from the net sales. The formula to calculate gross profit is:

Gross Profit = Net Sales - Cost of Goods Sold

According to the information provided:

• Net Sales for the current year were $2,540,276,000.
• Cost of Goods Sold was $178,604,000.

So, the gross profit for Harrison would be:

Gross Profit = $2,540,276,000 - $178,604,000 = $2,361,672,000

Therefore, the correct gross profit for Harrison in the current year is $2,361,672,000.