Instructions:  Fill in the amounts that are missing.                                                     2013                  2014              2015Sales                                           217,500             ?                       307,500Sales Returns                               8,250                  9,750               ? Net Sales                                    ?                      260,250               ?Beginning Inventory                15,000                    24,000            ?Ending Inventory                           ?                        ?                   ?Purchases                                       ?                   195,000         223,500Purchase Returns & Allowances    3,750                6,000             7,500Transportation - in                      6,000                6,750              9,000    Cost of Goods Sold                   174,750              ?                     219,750Gross Profit                                  34,500             68,250               72,750

Question
Asked Dec 3, 2019
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Instructions:  Fill in the amounts that are missing.

                                                     2013                  2014              2015

Sales                                           217,500             ?                       307,500

Sales Returns                               8,250                  9,750               ?

Net Sales                                    ?                      260,250               ?

Beginning Inventory                15,000                    24,000            ?

Ending Inventory                           ?                        ?                   ?

Purchases                                       ?                   195,000         223,500

Purchase Returns & Allowances    3,750                6,000             7,500

Transportation - in                      6,000                6,750              9,000    

Cost of Goods Sold                   174,750              ?                     219,750

Gross Profit                                  34,500             68,250               72,750

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Expert Answer

Step 1

On the basis of given question, we need to find out the missing numbres.

We shall start with year 2014 for our calculations-

Below formulas are used -

1. Gross sales= Net sales + Sales return = 260250+ 9750 = 270000

2. Cost of goods sold = Net sales - Gross profit= 260250- 68250= 192000

3. Ending inventory = Opening inventory + net purchases + transport - Cost of goods sold

Ending inventory 
Opening stock24000
Net purchase189000
Transport6750
Total219750
Less COGS-192000
Ending inventory=27750

 

where net purchases is purchases - purchase return made= 195000- 6000= 189000

 

Attached are the miising numbers in yellow for year 2014.

 

2014
270000
9750
Sales
Sales return
260250
Net Sales
Beginning inventory
Ending inventory
24000
27750
Purchases
195000
6000
Purchase return and allowances
Net Purchases
6750
Transportation-in
Cost of goods sold
Gross profit
192000
68250
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Image Transcriptionclose

2014 270000 9750 Sales Sales return 260250 Net Sales Beginning inventory Ending inventory 24000 27750 Purchases 195000 6000 Purchase return and allowances Net Purchases 6750 Transportation-in Cost of goods sold Gross profit 192000 68250

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Step 2

We shall now calculate the 2015 year numbers-

below are the calculations- 

Please note the closing inventory for year 2014 will be the opening inventory of year 2015 as per the accounting principles. therefore, opening inventory will 27750 ( the closing balance carried forward of the year 2014)

 1. Net sales = Cost of goods sold + Gross profit= 219750+ 72750= 292500

2. Salesreturn = Sales - net sales = 307500- 292500= 15000

3. Ending inventory = Opening inventory + net purchases+ transport- Cost of goods sold, 

Ending inventory 
Opening stock27750
Net purchase216000
Transport9000
Total252750
Less COGS-219750
Ending inventory=33000

where net purchase = 223500 purchases less- 7500  purchase retrun= 216000

Using the above calculations, attached the are missing numbers for year 2015 in yellow- 

2015
307500
15000
292500
Sales
Sales return
Net Sales
Beginning inventory
Ending inventory
27750
33000
Purchases
Purchase return and allowances
Net Purchases
Transportation -in
223500
7500
9000
Cost of goods sold
Gross profit
219750
72750
help_outline

Image Transcriptionclose

2015 307500 15000 292500 Sales Sales return Net Sales Beginning inventory Ending inventory 27750 33000 Purchases Purchase return and allowances Net Purchases Transportation -in 223500 7500 9000 Cost of goods sold Gross profit 219750 72750

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Step 3

Now we shall calculate the 2013 numbers as follows;

1. Please note the openinh inventory of 2014 was the closing inventory for year 2013, hence it will 24000.

2. Net sales = Sales - Sales return= 217500- 8250= 209250

3. Purchases = Ending inventory + cost of goods sold  - opening inventory- transport charges

Opening inventory 
Ending inventory24000
COGS174750
Less opening i...
2013
217500
8250
Sales
Sales return
Net Sales
209250
Beginning inventory
Ending inventory
15000
24000
177750
Purchases
3750
Purchase return and allowances
Net Purchases
Transportation -in
6000
Cost of goods sold
Gross profit
174750
34500
help_outline

Image Transcriptionclose

2013 217500 8250 Sales Sales return Net Sales 209250 Beginning inventory Ending inventory 15000 24000 177750 Purchases 3750 Purchase return and allowances Net Purchases Transportation -in 6000 Cost of goods sold Gross profit 174750 34500

fullscreen

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