During the current year, merchandise is sold for $775,000. The cost of the merchandise sold is $426,250.

Question:

During the current year, merchandise is sold for $775,000. The cost of the merchandise sold is $426,250.
a. What is the amount of the gross profile?
b. Compute the gross profile percentage (gross profile divided by sales).
c. Will the income statement necessarily report a net income? Explain.