Todrick Company is a merchandiser that reported the following information based on 1,000 units sold:- Gross sales: \$50,000- Sales returns and allowances: \$2,000- Sales discounts: \$1,000What is the net sales amount for Todrick Company?

• A. \$48,000
• B. \$47,000
• C. \$50,000
• D. \$49,000

Answer: (B)

Verified step by step guidance

1. Step 1: Understand the concept of net sales. Net sales is calculated by subtracting sales returns and allowances, as well as sales discounts, from gross sales. This represents the actual revenue earned from sales after adjustments.
2. Step 2: Write the formula for net sales: Net Sales = Gross Sales - Sales Returns and Allowances - Sales Discounts.
3. Step 3: Substitute the given values into the formula. Gross Sales = \$50,000, Sales Returns and Allowances = \$2,000, and Sales Discounts = \$1,000.
4. Step 4: Perform the subtraction operations step by step. First, subtract Sales Returns and Allowances from Gross Sales, then subtract Sales Discounts from the result.
5. Step 5: The final result after performing the calculations will give you the net sales amount for Todrick Company.