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Gross sale is one of important measure of the performance and efficiency of any company. Gross sales means total sales which is done by company. It is the sales which is done all departments and branches of company. It includes both cash and credit sales. It is calculated before discounts and deduction of total sales returns.

Example :

For example : ABC Company has sold goods with A,B and C branches \$ 1,00,000 each.  So, gross sales is \$ 3,00,000. Out of this \$ 20,000 sales were cancelled because of check bounce. Out of gross sales, 10% discount was given. Total sales returns were \$ 30,000. So, net sales will be

= Gross Sales + (Discount on Sales return and cancelled sales)- ( Sales return + Sale cancelled + Discount on sales)

=  {3,00,000 + ( 50,000 X 10%) }- { ( 30000+20000) + (300000 X 10%)}

= 305000 - (50000+30000)

= \$ 225000

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