Test:Week 3 -review assessment 1 Submit Test This Question: 1 pt 13 of 16 (11 co

Question

Test:Week 3 -review assessment 1 Submit Test This Question: 1 pt 13 of 16 (11 complete) This Test: 16 pts possible Precious Curts is a retail chain specializing in salon-quality haik-care products During the year Precious Curls had sales of $39 235,000. The company began the year with $3,775,000 of merchandise inventory and ended the year with $4,750,000 of inventory. During the year Precious Curls purchased $24.215,000 of merchandise inventory The company's seling, general, and administrative expenses totaled $6,150.000 for the year. Prepare Precious Curls' income statement for the year Begin by calculating Precious Curls' cost of goods sold using the table below Precious Curls Calculation of Cost of Goods Sold For the Year Ended Sales revenues numner in the input flields and then continue to the next question

Explanation / Answer

Calculation of cost of goods sold (COGS) = Beginning Inventory+ Purchase during the year- Closing inventory.

Beginning Inventory = $ 3,775,000

Purchases during the year = $24,215,000

Closing Inventory= $ 4,750,000

COGS= $ 3,775,000+ $ 24215000- $ 4,750,00 = $ 23,240,000

Income statement :

Particulars Amount in $

Net sales 39,235,000

Less: Cost of goods sold (23,240,000)

Gross Profit 15,995,000  

Less: Selling, general and

administrative expenses (6,150,000)

Net Profit 9,845,000

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