Question

Question 11 of 20: Select the best answer for the question. 11.

Given gross sales of $50,000, sales returns and allowances of $6,000, beginning inventory of $4,000, net purchases of $8,000, ending inventory of $2,000, and operating expenses of $4,500, calculate net income.
A. $32.500
B. $28,550
C. $29.500
D. $30,570​

Answer 1

Answer: $29500

Explanation:

Given the information from the question, the net income will be calculated as:

Net sales = Gross profit - sales returns and allowances

= $50000 - $6,000

= $44000

Gross profit = Net sales - Cost of goods sold

= $44000 - $10000

= $34000

Net income = Gross profit - Operating expense

= $34000 - $4500

= $29500