The earbuds are sold in cases, with each case containing a pair of earbuds. The last quarter (October to December) of 2021 began with 30 cases of earbuds at a total cost of $187,800. During the quarter the business completed the following transactions relating to the earbuds October 8 98 cases were purchased at a cost of $6,202 each. In addition, the business paid a freight charge of $248 cash on each case to have the inventory shipped from the point of purchase to their place of business. October 31 The sales for October were 85 cases which yielded total sales revenue of $809,030. (25 of these cases were sold on account to three longstanding customers) November 4 A new batch of 67 cases was purchased at a total cost of $465,650 November 10 5 of the cases purchased on November 4 were returned to the supplier, as they were not of the type nor model ordered. November 30 During the month 60 cases were sold at a price of $10,350 each. December 4 A customer, to whom 9 cases were sold during the first business day of November, returned 3 of the cases, as they were of another make and model. December 10 Owing to an increased demand, a further 115 cases were purchased at a cost of $7,900 each; these were subject to a trade discount of 2% each. December 30 121 cases were sold during December at a unit selling price of $11,085 December 31 An actual count of inventory was carried out which revealed that there were 34 cases of the brand of merchandise in the store room.
The earbuds are sold in cases, with each case containing a pair of earbuds. The last quarter (October to December) of 2021 began with 30 cases of earbuds at a total cost of $187,800. During the quarter the business completed the following transactions relating to the earbuds
|
October 8 |
98 cases were purchased at a cost of $6,202 each. In addition, the business paid a freight charge of $248 cash on each case to have the inventory shipped from the point of purchase to their place of business. |
|
October 31 |
The sales for October were 85 cases which yielded total sales revenue of $809,030. (25 of these cases were sold on account to three longstanding customers) |
|
November 4 |
A new batch of 67 cases was purchased at a total cost of $465,650 |
|
November 10 |
5 of the cases purchased on November 4 were returned to the supplier, as they were not of the type nor model ordered. |
|
November 30 |
During the month 60 cases were sold at a price of $10,350 each. |
|
December 4 |
A customer, to whom 9 cases were sold during the first business day of November, returned 3 of the cases, as they were of another make and model. |
|
December 10 |
Owing to an increased demand, a further 115 cases were purchased at a cost of $7,900 each; these were subject to a trade discount of 2% each. |
|
December 30 |
121 cases were sold during December at a unit selling price of $11,085 |
|
December 31 |
An actual count of inventory was carried out which revealed that there were 34 cases of the brand of merchandise in the store room. |
|
|
Unless otherwise stated, assume that all purchases were on |
(B) Given that selling, distribution and administrative costs associated with the brand of earbuds for the quarter were $42,844, $38,120 and $157,076 respectively, prepare an income statement for the quarter ended December 31, 2021.
Step by step
Solved in 2 steps
