Question

A company has net sales of $763,000 and cost of goods sold of $551,000. Its net income is $20,160. The company's gross margin and operating expenses, respectively, are:

Answer 1

27.79%; $191,840

Step-by-step explanation:

Given that,

Net sales = $763,000

Cost of goods sold = $551,000

Net Income = $20,160

Gross Profit :

= Net sales - Cost of goods sold

= $763,000 - $551,000

= $212,000

Gross margin :

= Gross Profit ÷ Net sales

= $212,000 ÷ $763,000

= 0.2779 or 27.79%

The operating expenses can be modeled with:

Net Income = Revenues - Expenses - COGS

$20,160 = $763,000 - Expenses - $551,000

Expenses = $191,840