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8 June, 02:15

A company manufactured 50,000 units of a product at a cost of $450,000. It sold 45,000 units at $15 each. The gross profit is a.$270,000 b.$240,000 c.$750,000 d.$600,000

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  1. 8 June, 02:30
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    The answer is A. $270,000

    Explanation:

    Gross profit is a measure of profitability. It can be derived by deducting cost of sales (cost of goods sold) from the net sales or revenue i. e Net sales (revenue) minus cost of sales:

    Sales or Revenue: 45,000 units at $15

    45,000 x 15

    =$675,000

    Cost of sales:

    45,000units = ($450,000 / 50,000 units) * 45,000 = $405,000

    Therefore, gross profit is:

    $675,000 - $405,000

    =$270,000
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