What will be the gross profit ratio of the company if sales are ₹4,20,000, sales returns are ₹20,000, and the cost of goods sold ₹3,20,000?

20%

Gross Profit Ratio = Gross Profit/Net Revenue of Operations × 100
                              = ( 80000/400000) x 100
                              = 20%

Net revenue from operations = Revenue from operations - sales return
                                              = 420000-20000
                                              = ₹400000
Gross profit = Net revenue from operations - Cost of revenue from operations
                   = 400000-320000
                   = ₹80000