Question

Mer Lea P5-35A Journalizing purchase and sal Journalize the following transac World. No explanations are receivable with the vendor or customer at the end of each month. 8 purchase and sale transactions he following transactions that occurred in November 2018 for Julie's Fun explanations are needed. Identify each accounts payable and accounts with the vendor or customer name. Julie's Fun World estimates sales returns NOV.4 Purchased merchandise inventory on account from Vera Company, $5,000. Terms 3/10, n/EOM, FOB shipping 6 Paid freight bill of $100 on November 4 purchase. 8 Returned half the inventory purchased on November 4 from Vera Company 10 Sold merchandise inventory for cash, $1,100. Cost of goods, $400. FOB destination. 11 Sold more Sold merchandise inventory to Geary Corporation, $11,100, on account, terms of 2/10, n/EOM. Cost of goods, 56,105. FOB shipping point. 12 Paid freight bill of $20 on November 10 sale. 13 Sold merchandise inventory to Caldwell Company, $9,500, on account, terms of n/45. Cost of goods, $5,225. FOB shipping point. 14 Paid the amount owed on account from November 4, less return and discount. 17 Received defective inventory as a sales return from the November 13 sale, $500. Cost of goods, $275. 18 Purchased inventory of $3,600 on account from Rainman Corporation. Payment terms were 2/10, n/30, FOB destination. 20 Received cash from Geary Corporation, less discount. 26 Paid amount owed on account from November 18, less discount. 28 Received cash from Caldwell Company, less return. 29 Purchased inventory from Sandra Corporation for cash, $12,300, FOB shipping point. Freight in paid to shipping company, $170.

Answer 1

P5 - 38A

1 Single - Step Income Statement

Particular	Amount
Revenues
Interest Revenue	$400
Net Sales Revenue	$298,000
Total Revenue	$298400
Expenses
Rent Expenses	$15,100
Salaries Expenses (Administrative)	$2,000
Office Supplies	$6500
Interest Expenses	$2100
Depreciation (Administrative)	$1320
Utilities Expenses	$4600
Delivery Expenses	$3800
Cost of Goods Sold	$154960
Salaries Expenses (Selling)	$6000
Rent Expenses	$7100
Utilities Expenses (Selling)	$10000
Total Expenses	$213480
Net Income	$84920

2 Multi Step Income Statement

Particular	Amount
Sales	$298000
Cost of Goods Sold	($154960)
Gross Profit	$143040
Operating Expenses
Selling Expenses
Rent Expenses	$15100
Delivery Expenses	$3800
Salaries Expenses	$6000
Utilities Expenses	$10000
	$34900
Administrative Expenses
Salaries Expenses	$2000
Depreciation	$1320
Utilities Expenses	$4600
Office Supplies	$6500
Interest Expenses	$2100
Rent Expenses	$7100
	$23620
Total Operating Expenses	$58520
Operating Income ($143040 - $58520)	$84520
Non Operating and other Income
Interest Revenue	$400
Net Income ($84520 + $400)	$84920

3.

Gross Profit percentage = Total Sales - Cost of Goods Sold / Total Sales

= $298000 - $154960/$298000

= 48%

MR fisher strives to earn 50% but actually he earn lower than it 48%.