Computing Gross Profit and Operating Income Following is an excerpt from the Packer Inc. year-end trial balance dated December 31, 2020. Selected Adjusted Trial Balance Amounts Acct. No. Description Debit Credit 400 Sales revenue $112,000 402 Consulting revenue 1,600 404 Gain on sale of investments 4,480 510 Cost of goods sold $40,000 511 Selling expense 17,600 512 Salaries expense 4,800 520 Rent expense 3,200 526 Insurance expense 800 528 Depreciation expense 1,600 530 Research and development expense 8,000 535 Loss on sale of investments 2,880 540 Interest expense 800 542 Income tax expense 3,120 Required a. Compute gross profit for 2020. Answer 72,000 b. Compute operating income for 2020. Answer 75,520
Computing Gross Profit and Operating Income Following is an excerpt from the Packer Inc. year-end trial balance dated December 31, 2020. Selected Adjusted Trial Balance Amounts Acct. No. Description Debit Credit 400 Sales revenue $112,000 402 Consulting revenue 1,600 404 Gain on sale of investments 4,480 510 Cost of goods sold $40,000 511 Selling expense 17,600 512 Salaries expense 4,800 520 Rent expense 3,200 526 Insurance expense 800 528 Depreciation expense 1,600 530 Research and development expense 8,000 535 Loss on sale of investments 2,880 540 Interest expense 800 542 Income tax expense 3,120 Required a. Compute gross profit for 2020. Answer 72,000 b. Compute operating income for 2020. Answer 75,520
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter5: Sales And Receivables
Section: Chapter Questions
Problem 77E: Ratio Analysis The following information was taken from Logsden Manufacturings trial balances as of...
Related questions
Question
Computing Gross Profit and Operating Income Following is an excerpt from the Packer Inc. year-end trial balance dated December 31, 2020. Selected Adjusted Trial Balance Amounts Acct. No. Description Debit Credit 400 Sales revenue $112,000 402 Consulting revenue 1,600 404 Gain on sale of investments 4,480 510 Cost of goods sold $40,000 511 Selling expense 17,600 512 Salaries expense 4,800 520 Rent expense 3,200 526 Insurance expense 800 528 Depreciation expense 1,600 530 Research and development expense 8,000 535 Loss on sale of investments 2,880 540 Interest expense 800 542 Income tax expense 3,120 Required a. Compute gross profit for 2020. Answer 72,000 b. Compute operating income for 2020. Answer 75,520
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning