In real life, income tax expense would be reported between net other revenues and expenses and Net Income. It is excluded in this illustration and in the textbook for simplicity.

Gross Sales P600,000

Sales Return & allow. P5,000

Sales Discounts 3,000

Cost of Merchandise Sold 300,000

Selling Expenses 50,000

Admin Expense 45,000

Interest Revenue 1,000

Interest Expense 700

What is the Gross Profit?