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Nueva Company reported the following pretax data for its first year of operations. Net sales 7,340 Cost of goods available for sale 5,790 Operating expenses 1,728 Effective tax rate 25 % Ending inventories: If LIFO is elected 618 If FIFO is elected 798 What is Nueva's gross profit ratio (rounded) if it elects FIFO?

Respuesta :

zunesyed

Answer:

32%

Explanation:

The net sales of the Nueva Company is $7340. If good available for sales cost $5790 and the company opted FIFO method, then the cost of goods sold is $4992. Net sales minus COGS = Gross Profit

Solution:

Net sales = $7,340

Cost of goods sold ($5,790 – 798) = 4,992

Gross profit = 2,348

$2,348/$7,340 = 32%