To compute net sales, you need to subtract the following items from gross sales:
1. Sales Discounts: The sales discounts are given as $50,000. This represents the discounts offered to customers on sales. So, you need to subtract $50,000 from gross sales.
2. Sales Returns and Allowances: The sales returns and allowances are given as $75,000. This represents returns or allowances made to customers for sales made during the period. So, you also need to subtract $75,000 from gross sales.
Now let's calculate net sales using the given data:
Gross Sales: $2,500,000
Sales Discounts: $50,000
Sales Returns and Allowances: $75,000
Net Sales = Gross Sales - Sales Discounts - Sales Returns and Allowances
Net Sales = $2,500,000 - $50,000 - $75,000
Net Sales = $2,375,000
Therefore, the net sales for the given data is $2,375,000.