The Artisan Wines is a retail store selling vintage wines. On December 31, 2019,
ID: 2432023 • Letter: T
Question
The Artisan Wines is a retail store selling vintage wines. On December 31, 2019, the firm's general ledger contained the accounts and balances below. All account balances are normal Artisan Wines Year Ended December 31, 2019 Trial Balance Adjusted Trial Balance Income Statement 27,486.00 27,486.00 1,080.00 11,100.00 14,100.00 11,100.00 $27,486.00 1,080.00 11,100.00 Accounts Receivable Merchandise Inventory Store Equipment Accumulated Depreciation-Store Equipment Office Equipment Accumulated Depreciation-Office Equipment Notes Payable, due 2020 Accounts Payable Wages Payable Social Security Tax Payable Medicare Tax Payable Unearned Scminar Fecs Interest Payable Vincent Arroyo, Capit Vincent Arroyo, Drawing 20,500.00 20,500.00 20,500.00 5,000.00 2,320.00 15,500.00 1,805.00 15,500.00 3,300.00 2,200.00 1,100.00 1,100.00 36,270.00 13,210.00 14,100.00 11,100.00 14,100.00 11,100.00 14,100.00 11,100.00 144,970.00 144,970.00 144,970.00 Sales Discounts 2,200.00 86,500.00 86,500.00 Purchases Returns and Allowances Freight In 12,300.00 12,300.00 23,700.00 Payroll Taxes Expense Depreciation Expense-Store Equipment Depreciation Expense Office Equipment Advertising Expense Supplies Expense Interest Expense $206, 265.00 $206, 265.00 $32, 628.40 $32, 628.40 $221, 898.40 $221, 898.40 $143,957.40 $159,180.00 $77,941.00 $62,718.40 $159,180.00 $159,180.00 $77,941.00 $77,941.00Explanation / Answer
ARTISAN WINES
INCOME STATEMENT
For the year ended december 31 2019
$
$
$
Operating Revenue
Sales
144970
Less: Sales discount
-110
Net Sales
144860
Cost of goods sold
Merchandise inventory opening
14100
Purchases
86500
Freight in
135
Delivered cost of purchases
86635
Less: purchase returns and allowances
-910
Net delivered cost of purchases
85725
Goods available for sale
99825
Less: Merchandise inventory closing
-11100
Cost of goods sold
88725
Gross profit on sales
56135
Operating expenses
Rent expense
12300
wages expense
23700
Payroll taxes expense
2469.9
Depreciaiton expense - store equipment
2900
Depreciation expense - office equipment
910
Advertising expense
540
Supplies expense
155
Total operating expense
42974.9
Income from operations
13160.1
Other incom
Seminar fee income
2200
2200
Other expenses
Interest expense
137.5
137.5
Net non operating income
15222.6
ARTISAN WINES
INCOME STATEMENT
For the year ended december 31 2019
Vincent Arroyo capital,janury 1
36270
Net income for the year
15222.6
Less: withdrawls for the year
-13210
Increase in capital
2012.6
Vincent Arroyo capital,December 31
38282.6
ARTISAN WINES
Balance sheet
For the year ended december 31 2019
Assets
Current Assets
Cash
27486
Accounts receivable
410
Merchandise inventory
11100
Prepaid Advertising
1080
Supplies
55
Total current assets
40131
Plant and equipment
Store equipment
20500
Less: Accumulated depreciation
-5000
15500
Office equipment
4100
Less: Accumulated depreciation
-2320
1780
Total plant and equipment
17280
Total assets
57411
Liabilities and owner equity
current liabilities
social security tax Payable
37.2
Medicare tax payable
8.7
Unearned seminar fees
1100
Notes Payable
15500
Accounts Payable
1805
Wages Payable
600
Interest Payable
77.5
Total current liabilities
19128.4
Total liabilities
Vincent Arroyo capital,janury 1
36270
Net income for the year
15222.6
Less: withdrawals for the year
-13210
Increase in capital
2012.6
Vincent Arroyo capital, December 31
38282.6
Total liabilities and owners equity
57411
what is the inventory turnover for Artisan wines?
7.04 times
Cost of goods sold
88725
Average inventory
(14100+11100)/2
12600
Inventory turnover ratio
7.041667
ARTISAN WINES
INCOME STATEMENT
For the year ended december 31 2019
$
$
$
Operating Revenue
Sales
144970
Less: Sales discount
-110
Net Sales
144860
Cost of goods sold
Merchandise inventory opening
14100
Purchases
86500
Freight in
135
Delivered cost of purchases
86635
Less: purchase returns and allowances
-910
Net delivered cost of purchases
85725
Goods available for sale
99825
Less: Merchandise inventory closing
-11100
Cost of goods sold
88725
Gross profit on sales
56135
Operating expenses
Rent expense
12300
wages expense
23700
Payroll taxes expense
2469.9
Depreciaiton expense - store equipment
2900
Depreciation expense - office equipment
910
Advertising expense
540
Supplies expense
155
Total operating expense
42974.9
Income from operations
13160.1
Other incom
Seminar fee income
2200
2200
Other expenses
Interest expense
137.5
137.5
Net non operating income
15222.6
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