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Adjusted Account Balances Merchandise inventory (ending) Other (non-inventory) assets Total liabilities Common stock Retained earnings Dividends Debit Credit $ 35,000 140,000 $ 40,425 69,497 47,114 8,000 Sales 239,400 Sales discounts Sales returns and allowances Cost of goods sold Sales salaries expense Rent expense-Selling space Store supplies expense Advertising expense Office salaries expense Rent expense-Office space Office supplies expense 3,663 15,800 92,945 32,798 11,252 2,873 20,349 29,925 2,873 958 Totals $ 396,436 $ 396,436 Beginning merchandise inventory was $28,245. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs. Invoice cost of merchandise purchases Purchases discounts received Purchases returns and allowances Costs of transportation-in $ 102,900 2,161 4,939 3,900 Required: 1. Compute the company's net sales for the year. 2. Compute the company's total cost of merchandise purchased for the year. 3. Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses. 4. Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.

Adjusted Account Balances Merchandise inventory (ending) Other (non-inventory) assets Total liabilities Common stock Retained earnings Dividends Debit Credit $ 35,000 140,000 $ 40,425 69,497 47,114 8,000 Sales 239,400 Sales discounts Sales returns and allowances Cost of goods sold Sales salaries expense Rent expense-Selling space Store supplies expense Advertising expense Office salaries expense Rent expense-Office space Office supplies expense 3,663 15,800 92,945 32,798 11,252 2,873 20,349 29,925 2,873 958 Totals $ 396,436 $ 396,436 Beginning merchandise inventory was $28,245. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs. Invoice cost of merchandise purchases Purchases discounts received Purchases returns and allowances Costs of transportation-in $ 102,900 2,161 4,939 3,900 Required: 1. Compute the company's net sales for the year. 2. Compute the company's total cost of merchandise purchased for the year. 3. Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses. 4. Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.

Century 21 Accounting General Journal
Century 21 Accounting General Journal
11th Edition
ISBN:9781337680059
Author:Gilbertson
Publisher:Gilbertson
Chapter20: Accounting For Inventory
Section: Chapter Questions
Problem 3AP
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Required information [The following information applies to the questions displayed below.] Valley Company's adjusted account balances from its general ledger on August 31, its fiscal year-end, follows. It categorizes the following accounts as selling expenses: sales salaries expense, rent expense-selling space, store supplies expense, and advertising expense. It categorizes the remaining expenses as general and administrative. Adjusted Account Balances Merchandise inventory (ending) Other (non-inventory) assets Debit Credit $ 35,000 140,000 $ 40,425 69,497 47,114 Total liabilities Common stock Retained earnings Dividends 8,000 Sales 239,400 3,663 15,800 92,945 32,798 11,252 2,873 20,349 29,925 2,873 Sales discounts Sales returns and allowances Cost of goods sold Sales salaries expense Rent expense-Selling space Store supplies expense Advertising expense Office salaries expense Rent expense-Office space Office supplies expense 958 Totals $ 396,436 $ 396,436 Beginning merchandise inventory was $28,245. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs. Invoice cost of merchandise purchases Purchases discounts received Purchases returns and allowances Costs of transportation-in $ 102,900 2,161 4,939 3,900
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] Valley Company's adjusted account balances from its general ledger on August 31, its fiscal year-end, follows. It categorizes the following accounts as selling expenses: sales salaries expense, rent expense-selling space, store supplies expense, and advertising expense. It categorizes the remaining expenses as general and administrative. Adjusted Account Balances Merchandise inventory (ending) Other (non-inventory) assets Debit Credit $ 35,000 140,000 $ 40,425 69,497 47,114 Total liabilities Common stock Retained earnings Dividends 8,000 Sales 239,400 3,663 15,800 92,945 32,798 11,252 2,873 20,349 29,925 2,873 Sales discounts Sales returns and allowances Cost of goods sold Sales salaries expense Rent expense-Selling space Store supplies expense Advertising expense Office salaries expense Rent expense-Office space Office supplies expense 958 Totals $ 396,436 $ 396,436 Beginning merchandise inventory was $28,245. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs. Invoice cost of merchandise purchases Purchases discounts received Purchases returns and allowances Costs of transportation-in $ 102,900 2,161 4,939 3,900
Adjusted Account Balances Merchandise inventory (ending) Other (non-inventory) assets Total liabilities Common stock Retained earnings Dividends Sales Sales discounts Sales returns and allowances Cost of goods sold Sales sallaries expense Rent expense-Selling space Store supplies expense Advertising expense Office salaries expense Rent expense-Office space Office supplies expense Ch Debit Credit $ 35,000 140,000 $ 40,425 69,497 47,114 8,000 239,400 3,663 15,800 92,945 32,798 11,252 2,873 20,349 29,925 2,873 958 Totals $ 396,436 $ 396,436 Beginning merchandise inventory was $28,245. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs. Invoice cost of merchandise purchases Purchases discounts received Purchases returns and allowances Costs of transportation-in $ 102,900 2,161 4,939 3,900 Required: 1. Compute the company's net sales for the year. 2. Compute the company's total cost of merchandise purchased for the year. 3. Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses. 4. Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.
Transcribed Image Text:Adjusted Account Balances Merchandise inventory (ending) Other (non-inventory) assets Total liabilities Common stock Retained earnings Dividends Sales Sales discounts Sales returns and allowances Cost of goods sold Sales sallaries expense Rent expense-Selling space Store supplies expense Advertising expense Office salaries expense Rent expense-Office space Office supplies expense Ch Debit Credit $ 35,000 140,000 $ 40,425 69,497 47,114 8,000 239,400 3,663 15,800 92,945 32,798 11,252 2,873 20,349 29,925 2,873 958 Totals $ 396,436 $ 396,436 Beginning merchandise inventory was $28,245. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs. Invoice cost of merchandise purchases Purchases discounts received Purchases returns and allowances Costs of transportation-in $ 102,900 2,161 4,939 3,900 Required: 1. Compute the company's net sales for the year. 2. Compute the company's total cost of merchandise purchased for the year. 3. Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses. 4. Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.
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