If sales is D 12,000 and the gross profit mark -up percentage is 25%. What is the cost of sales?
- D 2,400
-
D 9,000
- D 9,600
- D 3,000
The correct answer is: B
Explanation
Calculate the gross profit using the gross profit mark-up percentage:
Gross Profit = Sales Amount * (Gross Profit Mark-up Percentage / 100)
Gross Profit = D12,000 * (25 / 100)
Gross Profit = D12,000 * 0.25
Gross Profit = D3,000
Calculate the cost of sales by subtracting the gross profit from the sales amount:
Cost of Sales = Sales Amount - Gross Profit
Cost of Sales = D12,000 - D3,000
Cost of Sales = D9,000
Therefore, the cost of sales is D9,000.