Presented below are selected ledger accounts of Woods Corporation at December 31

Question

Presented below are selected ledger accounts of Woods Corporation at December 31, 2012.

Cash $185,000 Sales salaries $291,500
Merchandise inventory 539,500 Office salaries 355,800
Sales 4,298,200 Purchase returns 15,000
Advances from customers 117,000 Sales returns 79,000
Purchases 2,786,000 Transportation-in 72,000
Sales discounts 34,000 Accounts receivable 142,500
Purchase discounts 27,000 Sales commissions 83,000
Travel and entertainment 69,000 Telephone-sales 17,000
Accounting and legal services 33,000 Utilities-office 32,000
Insurance expense-office 24,000 Miscellaneous office expenses 8,000
Advertising 54,000 Rental revenue 240,000
Transportation-out 93,000 Extraordinary loss (before tax) 70,000
Depreciation of office equipment 48,000 Interest expense 176,000
Depreciation of sales equipment 36,000 Common stock ($10 par) 900,000

Explanation / Answer

Mechandise Inventory, Jan 1 $538,100 Purchases $2,786,000 Less: Purchase Discounts 27,000 Less: Purchase Returns 15,000 Net Purchases 2,744,000 Add: Freight In 72,000 2,816,000 Mechandise Avaliable For Sale 3,354,100 Mechandise Inventory, Dec 31 686,600 Cost of Goods Sold $2,667,500

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