Question

Refer to the following data: Net sales, first month $13,000 Normal gross profit as a percentage of sales 45% Inventory, start of period $8,000 Net purchases, first month $7,000 Using the gross profit method of inventory estimation, the amount of normal gross profit would be:______.a. $5,850.b. $3,600. c. $6,750. d. $15,000.

Answer 1

a. $5,850

Step-by-step explanation:

Using the gross profit method of inventory estimation, the amount of normal gross profit would be;

= Net sales × Normal gross profit margin percentage

= $13,000 × 45%

= $5,840