Question

2. Happy Selling's Sales amounted to Php 500,000. Sales returns and sales discounts amounted to Php
30,000 and Php 10,000 respectively. Purchases of the company totaled Php 100,000 while purchase
returns and purchase discounts amounted to Php 20,000 and Php 10,000 respectively. How much is the
company's Net Sales? Net Purchases?
Answer:

Answer 1

Answer:

Net Sales

= Sales - Sales returns - Sales discounts

= 500,000 - 30,000 - 10,000

= Php 460,000

Net Purchases

= Purchases - Purchase returns - Purchase discounts

= 100,000 - 20,000 - 10,000

= Php 70,000

Answer 2

The net sales and net purchases of Happy Selling are Php 460,000 Php 70,000 respectively.

What are net sales and net purchases?

Net sales refer to the sales value that is obtained after adjusting the return and discounts. Therefore the net sales will be:

$\rm Net \:sales = Total \:sales - Sales\:returns-\:Sales \:discounts\\\\\rm Net \:sales = Php\: 500,000 - Php\: 30,000 - Php\: 10,000\\\\\rm Net \:sales = Php\:460,000$

Therefore the net sales are Php 460,000.

Similarly, net purchases refer to the purchase value that is obtained after adjusting the return and discounts. Therefore the net purchases will be:

$\rm Net \:purchases = Total \:sales - Purchase \:returns-\:Purchase \:discounts\\\\\rm Net \:purchases = Php\:100,000 - Php\: 20,000 - Php\: 10,000\\\\\rm Net \:purchases = Php\:70,000$

Therefore the net purchases are Php 70,000.

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