Question

journee camping supply store has net sales of $900,000, cost of goods sold of $550,000, income before taxes of $55,000 and income tax expense of $5,000. what is its return on sales?

Answer 1

6.1%

Step-by-step explanation:

To calculate the return on sales for Journee Camping Supply Store, you can divide the income before taxes by the net sales and multiply by 100 to express the result as a percentage.

In this case, the return on sales would be calculated as follows:

Return on sales = (Income before taxes / Net sales) x 100

= ($55,000 / $900,000) x 100

= 6.1%

This means that for every $1 in net sales, Journee Camping Supply Store generates a profit of 6.1 cents. The return on sales is a measure of the efficiency with which a company converts its sales into profit, and it can be used to compare the performance of different companies in the same industry.