If the net income is $50000, and the cost of goods sold is $450000.
the company's gross profit rate is 40% what are the net sales??
To determine the net sales, we need to calculate the gross profit first.
Gross profit is calculated by subtracting the cost of goods sold (COGS) from the net sales:
Gross Profit = Net Sales - COGS
Given that the gross profit rate is 40% and the COGS is $450,000, we can calculate the gross profit using the formula:
Gross Profit = Gross Profit Rate × Net Sales
Plugging in the given values, we get:
$500,000 = 0.4 × Net Sales
To find the net sales, divide both sides of the equation by 0.4:
Net Sales = $500,000 / 0.4
Simplifying the calculation, we get:
Net Sales = $1,250,000
Therefore, the net sales are $1,250,000.