Question

value: 15.00 points This exercise stresses the relationships between the information recorded in a periodic inventory system and the basic elements of an income statement. Each of the five lines represents a separate set of information. You are to fill in the missing amounts. (Input all amounts as positive values except net loss which should be indicated with a minus sign. Omit the "$" sign in your response.) Profit Cost of Goods Sold Beginning Inventory Net Purchases Ending Inventory 35,200 Gross Profit Expenses 72,000 or (Loss) Net Sales 105,200 250,000 76,000 104,000 a. 20,000 264,000 78,000 270,000 470,000 b. 189,000 160,000 441,000 220,000 170,000 630,000 C. 234,000 270,000 135,000 450,000 820,000 d. (15,000) 130,000 250,000 400,000 156,000 e.

Answer 1

	Net Sales	Beginning Inventory	Net Purchases	Ending Inventory	Cost of Goods Sold	Gross Profit	Expenses	Profit or (Loss)
a.	250,000	76,000	104,000	35,200	144,800	105,200	72,000	33,200
b.	470,000	78,000	270,000	84,000	264,000	206,000	186,000	20,000
c.	630,000	220,000	391,000	170,000	441,000	189,000	160,000	29,000
d.	820,000	271,000	450,000	135,000	586,000	234,000	270,000	(36,000)
e.	530,000	156,000	494,000	250,000	400,000	130,000	145,000	(15,000)

• Cost of goods sold + Gross profit = Sales
• Cost of goods sold = Beginning inventory + Net purchases - Ending inventory
• Profit or (loss) = Gross profit - Expenses

(a)

• Cost of goods sold = Beginning inventory + Net purchases - Ending inventory = 76,000 + 104,000 - 35,200 = 144,800; Alternatively Cost of goods sold = Sales - Gross profit = 250,000 - 105,200 = 144,800
• Profit = Gross profit - Expenses = 105,200 - 72,000 = 33,200

(b)

• Ending inventory = Beginning inventory + Net purchases - Cost of goods sold = 78,000 + 270,000 - 264,000 = 84,000
• Gross profit = Sales - Cost of goods sold = 470,000 - 264,000 = 206,000
• Expenses = Gross profit - Profit = 206,000 - 20,000 = 186,000

(c)

• Net purchases = Cost of goods sold - Beginning inventory + Ending inventory = 441,000 - 220,000 + 170,000 = 391,000
• Profit = Gross profit - Expenses = 189,000 - 160,000 = 29,000

(d)

• Beginning inventory = Cost of goods sold - Net purchases + Ending inventory = 586,000 - 450,000 + 135,000 = 271,000
• Cost of goods sold = Sales - Gross profit = 820,000 - 234,000 = 586,000 (in this case, cost of goods sold need to be found out first)
• Loss = Gross profit - Expenses = 234,000 - 270,000 = (36,000)

(e)

• Net Sales = Cost of goods sold + Gross profit = 400,000 + 130,000 = 530,000
• Net purchases = Cost of goods sold - Beginning inventory + Ending inventory = 400,000 - 156,000 + 250,000 = 494,000