Based on the following information, what are the amounts of gross profit and net income for Batavia Co.?
Batavia, Co.
Sales
$865,000
Cost of goods sold
320,000
Gross profit
?
Operating expenses
125,000
Operating income
?
a. Net income: $545,000; Gross profit: $545,000
b. Net income: $545,000; Gross profit: $740,000
c. Net income: $420,000; Gross profit: $545,000
d. Net income: $420,000; Gross profit: $740,000