Question

From the following, calculate Gross Profit Ratio:
Gross Profit:₹50,000; Revenue from Operations ₹5,00,000; Sales Return: ₹50,000.

Answer 1

$$\begin{gathered} \mathrm{Net}\mathrm{Sales}=\mathrm{Rs}5,00,000 \\ \mathrm{Gross}\mathrm{Profit}=\mathrm{Rs}50,000 \end{gathered}$$

$$\begin{gathered} \mathrm{Gross}\mathrm{Profit}\mathrm{Ratio}=\frac{\mathrm{Gross}\mathrm{Profit}}{\mathrm{Net}\mathrm{Sales}}\times 100 \\ =\frac{50,000}{5,00,000}\times 100=10\% \end{gathered}$$
Note: Here we will not deduct the amount of sales return because the amount of net sales has already been provided in the question.