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College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570

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BuyFindarrow_forward

College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570
Textbook Problem

A partial work sheet for The Fan Shop is presented here. The merchandise inventory at the beginning of the year was $52,300. P. G. Ochoa, the owner, withdrew $30,500 during the year.

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Required

  1. 1. Prepare an income statement.
  2. 2. Journalize the closing entries.

Check Figure

Cost of Goods Sold, $206,120

1.

To determine

Prepare an income statement for TF Shop for the year ended December 31, 20--.

Explanation

Income statement: The financial statement which reports revenues and expenses from business operations and the result of those operations as net income or net loss for a particular time period is referred to as income statement.

Prepare an income statement for TF Shop for the year ended December 31, 20--.

TF Shop
Income Statement
For the Year Ended December 31, 20--
Revenue from sales:    
   Sales  $324,000 
   Less: Sales returns and allowances $3,400  
            Sales discounts 2,7076,107 
   Net sales   $317,893
Cost of goods sold:    
   Merchandise inventory, January 1  $52,300 
   Purchases $201,490  
   Less: Purchase returns and allowances$2,880   
            Purchases discounts02,880  
   Net purchases 198,610  
   Add: Freight-in 9,790  
   Delivered cost of purchases  208,400 
 ...

2.

To determine

Prepare closing entries for TF Shop.

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