If sales are 2,000 and the rate of gross profit on cost of goods sold is 25% then the cost of goods sold will be
Answers
Explanation:
- Sales is Rs. 2,000
- Rate of Gross Profit = 25% on Cost of Goods Sold
- Cost of Goods Sold = ??
Solution :
Let,
- Cost of Goods Sold = x
Sales = Cost of Goods Sold + Gross Profit
2,000 = x + 0.25x
2,000 = 1.25x
1.25x = 2,000
x = 2,000/1.25
x = 1,600
Cost of Goods Sold = Rs. 1,600
OR :
Let,
Cost be 100
Gross Profit on Cost = 100 × (25/100) = 25
Sales = Cost + Gross Profit
125 = 100 + 25
Gross Profit on Sales = (25/125) × 100 = 20%
Gross Profit on Sales = (20/100) × 2,000
Gross Profit on Sales = 400
Cost of Goods Sold = Net Sales - Gross Profit
Cost of Goods Sold = 2,000 - 400
Cost of Goods Sold = Rs. 1,600
Therefore, The Cost Of Goods Sold will be Rs. 1,600.
Explanation:
sales are 2,000
the rate of gross profit on cost of goods sold is 25%
find :
the cost of goods sold
Assume,
Cost = 100
G.P. = 25% on cost
Sales= 125
cost of goods sold = (100/125)× 2,000
cost of goods sold = 1,600
Hence, cost of goods sold = 1,600