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Given
Beginning inventory = $10,000,
Cost of merchandise sold = $65,000,
Purchases return and allowance = $600,
Purchases discount = $900,
Gross profit =35% of net sales,
Merchandise available for sale =13/5 times of the Gross profit
Required: - Using the above data, you are required to choose the best answer for each of the following3 questions
1. The net sales and the Gross profit amounts are
A) 91,000 &31,850 respectively.
B) 81,000 and28,350 respectively.
C) 100,000 and35,000 respectively.
D) 82,500 and28,875 respectively.
E) None
2. The merchandise available for sale, and ending inventory costs are
A) 91,000 and35,000 respectively.
B) 82,500 and28,875 respectively.
C) 91,000 and28,875 respectively.
D) 81,000 and26,000 respectively.
E) 91,000 and26,000 respectively.
3. The purchases and the net purchases amounts are
A) 82,500 and81,000 respectively.
B) 91,000 and89,500 respectively.
C) 91,000 and90,400 respectively.
D) 81,000 and80,100 respectively.
E) 82,500 and81,600 respectively.
1) The right choice is (C).
2) The right choice is (E).
3) The right choice is (A).