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    Gross Profit Percentage from Property Sale & Mortgage

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    Kevin sold property with an adjusted basis of $58,000. The buyer assumed Kevin's existing mortgage of $40,000 and agreed to pay an additional $60,000 consisting of a cash down payment of $40,000, and payments of $4,000, plus interest, per year for the next 5 years. Kevin paid selling expenses totaling $2,000. What is Kevin's gross profit percentage?

    A. 33.33%
    B. 40%
    C. 60%
    D. 66.67%

    © BrainMass Inc. brainmass.com June 4, 2020, 4:04 am ad1c9bdddf
    https://brainmass.com/business/accounting/gross-profit-percentage-from-property-sale-mortgage-547672

    Solution Preview

    40,000 + 60,000 = 100,000

    100,000 - 58,000 - 2,000 = 40,000

    40,000 / 60,000 = ...

    Solution Summary

    This solution provides the correct answer, explanation, and all calculations to show the gross profit percentage for Kevin, based on the property sale scenario listed.

    $2.19

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