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The trial balance of Sanchez Company at the end of its fiscal year, August 31, 2

ID: 2427697 • Letter: T

Question

The trial balance of Sanchez Company at the end of its fiscal year, August 31, 2014, includes these accounts: Beginning Inventory $23,800; Purchases $239,300; Sales Revenue $198,900; Freight-In $8,700; Sales Returns and Allowances $5,000; Freight-Out $2,400; and Purchase Returns and Allowances $9,200. The ending inventory is $22,800.

Prepare a cost of goods sold section (periodic system) for the year ending August 31, 2014.

SANCHEZ COMPANY
Income Statement (cost of goods sold section (periodic system))
For the Year Ended August 31, 2014

SANCHEZ COMPANY
Income Statement (cost of goods sold section (periodic system))
For the Year Ended August 31, 2014

Cost of Goods Available for SaleCost of Goods PurchasedCost of Goods SoldDividendsExpensesInventory, September 1, 2013Inventory, August 31, 2014Net Income / (Loss)Net PurchasesRetained Earnings, September 1, 2011Retained Earnings, August 31, 2012RevenuesTotal ExpensesTotal Revenues

$

$

AddLess:

Cost of Goods Available for SaleCost of Goods PurchasedCost of Goods SoldDividendsExpensesInventory, September 1, 2013Inventory, August 31, 2014Net Income / (Loss)Net PurchasesRetained Earnings, September 1, 2011Retained Earnings, August 31, 2012RevenuesTotal ExpensesTotal Revenues

AddLess:

Cost of Goods Available for SaleCost of Goods PurchasedCost of Goods SoldDividendsExpensesInventory, September 1, 2013Inventory, August 31, 2014Net Income / (Loss)Net PurchasesRetained Earnings, September 1, 2011Retained Earnings, August 31, 2012RevenuesTotal ExpensesTotal Revenues

Cost of Goods Available for SaleCost of Goods PurchasedCost of Goods SoldDividendsExpensesInventory, September 1, 2013Inventory, August 31, 2014Net Income / (Loss)Net PurchasesRetained Earnings, September 1, 2011Retained Earnings, August 31, 2012RevenuesTotal ExpensesTotal Revenues

Cost of Goods Available for SaleCost of Goods PurchasedCost of Goods SoldDividendsExpensesInventory, September 1, 2013Inventory, August 31, 2014Net Income / (Loss)Net PurchasesRetained Earnings, September 1, 2011Retained Earnings, August 31, 2012RevenuesTotal ExpensesTotal Revenues

Cost of Goods Available for SaleCost of Goods PurchasedCost of Goods SoldDividendsExpensesInventory, September 1, 2013Inventory, August 31, 2014Net Income / (Loss)Net PurchasesRetained Earnings, September 1, 2011Retained Earnings, August 31, 2012RevenuesTotal ExpensesTotal Revenues

$

Explanation / Answer

Cost Of Goods Sold (Section)

Inventory in beggining . 23800

Purchases 239300

less purchase return (9200)

add frieght inward 8700

cost of goods puchased 238800

cost of goods for sale 262600

less closing inventory (22800)

cost of goods sold 239800