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11. Net sales is the amount of actual sales after reducing the sales return, allowances and discounts from gross sales. Here gross sales= 500,000 , sales return = 10,000 and sales discount = 10,000 Thus Net sales = Gross sales - sales return - sales discount Net sales = $ 500,000 - 10,000 - 10,000 Net sales = $ 480,000 Thus the correct option is -------------B. $ 480,000 12 ) Net Purchase is the amount of actual purchase after reducing the purchasing return, allowances and discounts from gross Purchses. Here gross Purchases= 130,000 , Purchase return = 10,000 and Purchase discount = 20,000 Thus Net Purchase = Gross Purchase - Purchase return - Purchase Discount Net Purchase = $ 130000 - $10000 - $20000 Net Purchase = $ 100,000 Thus the correct option is ------------------A . $100,000 13) Cost of goods sold = Opening Inventory + Purchases - Closing Inventory + Freight In Here, opening Inventory = $ 27000 , Net Purchase = $100000 and closing inventory = $ 20000 , Freight In = 20,000 Thus Cost of goods sold = $ 27,000 + 100,000 - 20,000 + 20,000 Cost of goods sold = $ 127,000 Thus the correct option is ---------C $ 127,000 14) Gross Margin = Net Sales - Cost of goods sold. Here net sales = $ 480,000 , Cost of goods sold = $ 127,000 Thus Gross Margin = $ 480,000 - 127,000 Gross Margin = $ 353,000 Thus the correct option is ------A. $353,000 15 ) Net Income = Gross Margin - Operating expenses. here other expenses are : general expesnes =$170,000 and selling expense = $50,000 Thus Net income = Gross Margin - General expenses - selling expenses Net income = 353,000 - 170,000 - 50,000 Net income = $ 133,000 Thus the correct option is ----------- B. $133,000

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