Question

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. $600,000
b. $270,000
c. $240,000
d. $750,000

Answer 1

Answer:

Gross Profit= Sales - Cost of Goods Sold

Cost of Goods sold of 1 unit = $ 450,000/50,000

= $ 9

Cost of Goods Sold of 45,000 units = 45,000 * $ 9

= $ 405,000

Gross Profit of 45,000 units = Sales revenue of 45,000 units - Cost of Goods sold of 45,000 units

= 45,000 * $ 15 (Per Unit rate) - $ 405,000

= $ 675,000 - $ 405,000

= $ 270,000 i.e. option b

Explanation:

Refer to the answer.