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Our Classroom-A×. | Course Home x, @Take a Test-kama× econsider The Fol KCSecure

ID: 2328194 • Letter: O

Question

Our Classroom-A×. | Course Home x, @Take a Test-kama× econsider The Fol KCSecure https/www.mathul.com/Student/PlayerTest.aspx?testid-18660597 Acct-1212-F18-003-18259 Quiz: Ch 16 Quiz This Question: 4 pts Consider the following partially completed income statements for merchandising companies and compute t (Click the icon to view the Income Statements.) Rustic Gear Boswell, Inc. Net Sales Revenue 101,000 Cost of Goods Sold: l Beginning Merchandise Inventory Purchases and Freight In Cost of Goods Available for Sale Ending Merchandise Inventory Cost of Goods Sold 29,000 52,000 92,000 (2,400) 58,000 43,000 (2,400) Gross Proft Selling and Administrative Expenses Operating Income 116,000 83,000 15,000

Explanation / Answer

Fit Apparel:

Operating Income = Gross Profit - Selling and Administrative Expenses
$15,000 = $43,000 - Selling and Administrative Expenses
Selling and Administrative Expenses = $28,000

Cost of Goods Sold = Cost of Goods Available for Sale - Ending Merchandise Inventory
$58,000 = Cost of Goods Available for Sale - $2,400
Cost of Goods Available for Sale = $60,400

Cost of Goods Available for Sale = Beginning Merchandise Inventory + Purchase and Freight In
$60,400 = Beginning Merchandise Inventory + $52,000
Beginning Merchandise Inventory = $8,400

White Corp.

Operating Income = Gross Profit - Selling and Administrative Expenses
Operating Income = $116,000 - $83,000
Operating Income = $33,000

Cost of Goods Available for Sale = Beginning Merchandise Inventory + Purchase and Freight In
$92,000 = $29,000 + Purchase and Freight In
Purchase and Freight In = $63,000

Cost of Goods Sold = Cost of Goods Available for Sale - Ending Merchandise Inventory
Cost of Goods Sold = $92,000 - $2,400
Cost of Goods Sold = $89,600

Gross Profit = Net Sales Revenue - Cost of Goods Sold
$116,000 = Net Sales Revenue - $89,600
Net Sales Revenue = $205,600

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