ACC1100 Lecture Notes - Lecture 4: Income Statement, Retained Earnings
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Given the following information, prepare in good form the costof goods sold section of an income statement for 20x5.
Freight-In | $ 4,000 |
Merchandise Inventory, December 31, 20x4 | 15,000 |
Merchandise Inventory, December 31, 20x5 | 16,000 |
Purchases | 38,000 |
Purchases Returns and Allowances | 1,800 |
ANS:
Merchandise Inventory, December 31, 20x4 | $ | ||
Purchases | $ | ||
Less Purchases Returns and Allowances |
| ||
Net purchases | $ | ||
Freight-in |
| ||
Net cost of purchases |
| ||
Cost of goods available for sale | $ | ||
Less Merchandise Inventory, December 31, 20x5 |
| ||
Cost of Goods Sold | $ |
Question 10 (15 points)
The following is a partial Adjusted Trial Balance for Alpha Company for the month:
Alpha Company | ||
Adjusted Trial Balance (partial) | ||
January 31, 2016 | ||
Accounts | Debit | Credit |
Inventory | $2,750 | |
Sales | $11,500 | |
Sales Discounts | 200 | |
Sales Returns & Allowances | 1,200 | |
Purchases | 4,000 | |
Purchases Discounts | 150 | |
Purchase Returns & Allowances | 450 | |
Freight In | 50 | |
Advertising Expense | 150 | |
Depreciation Expense | 130 | |
Freight Out | 70 | |
Income Tax Expense | 500 | |
Salaries Expense | 550 | |
Utilities Expense | 100 |
Additionally, Inventory for December 31, 2015 was $2,600. Prepare a multiple-step income statement.
What amount should Alpha Company report on a Multi-Step Income Statement for the following items:
1. Net Sales
2. Cost of Goods Available for Sales
3. Gross Profit
4. General & Administrative Expenses
5. Income before Taxes