Question

Newark Company has provided the following information:

Cash sales, $540,000
Credit sales, $1,440,000
Selling and administrative expenses, $420,000
Sales returns and allowances, $99,000
Gross profit, $1,450,000
Increase in accounts receivable, $64,000
Bad debt expense, $42,000
Sales discounts, $52,000
Net income, $1,030,000

How much are Newark's net sales?

Answer 1

$1829000.

Step-by-step explanation:

Given: Cash sales, $540,000.

Credit sales, $1,440,000.

Sales returns and allowances, $99,000.

Sales discounts, $52,000

Now, computing net sales of Newark.

Net sales=
`Cash\ sales+ Credit\ sales- Sales\ discount- Sales\ return`

Net sales=
`540000+ 1440000- 99000-52000`

⇒ Net sales=
`1980000- 151000`

∴ Net sales=
`\$ 1829000`

Hence, Newark´s net sales is $1829000.