Use the following information to answer the given question \(\begin{array}{c|c} & N \\ \hline Sales & 200,000 \\ \text{Opening Stock} & 20,000 \\ purchases ...

To calculate the gross profit, we need to subtract the cost of goods sold (COGS) from the total sales revenue. The formula for gross profit is: Gross Profit = Sales - Cost of Goods Sold We can calculate the COGS by using the following formula: COGS = Opening Stock + Purchases - Closing Stock Let's substitute the given values in the formula: COGS = 20,000 + 140,000 - 10,000 COGS = 150,000 Now we can calculate the gross profit using the first formula: Gross Profit = Sales - COGS Gross Profit = 200,000 - 150,000 Gross Profit = 50,000 Therefore, the gross profit is N50,000. In simple terms, gross profit is the profit a company earns after deducting the cost of goods sold from its total sales revenue. It indicates the profitability of a company's core business operations, without factoring in other expenses such as operating expenses or taxes.