Question

IGNMENT Saved Help Save & Exit Su Valley Company's adjusted trial balance on Aur 31, its fiscal year-end, follows. It categorizes the following accounts as selling expenses: sales salaries expense, rent expense elling space, store supplies expense, advertising expense. It categorizes the remaining expenses as general and administrative. Credit Debit $ 41,000 130,400 $ 25,000 104,550 8,000 225,600 Merchandise inventory (ending) Other (noninventory) assets Total liabilities K. Valley, Capital K. Valley, Withdrawals Sales Sales discounts Sales returns and allowances Cost of goods sold Sales salaries expense Rent expense-Selling space Store supplies expense Advertising expense Office salaries expense Rent expense-Office space office supplies expense Totals 2,250 12,000 74,500 32,000 8,000 1,500 13,000 28,500 3,600 400 $355,150 $355, 150 Beginning merchandise inventory was $25,400. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs. Invoice cost of merchandise purchases Purchases discounts received Purchases returns and allowances Costs of transportation-in $92,000 2,000 4,500 4,600 < Prey, 5 of 5 Next >

Answer 1

1
Sales	225600
Less: Sales discounts	(2250)
Sales returns and allowances	(12000)
Net sales	211350
2
Cost of Merchandise Purchased
Invoice cost of merchandise purchased	92000
Purchase discounts received	(2000)
Purchase returns and allowances	(4500)
Costs of transportation-in	4600
Total cost of merchandise purchased	90100
3
VALLEY COMPANY
Income Statement
For Year Ended August 31
Sales		225,600
Less: Sales discounts	2,250
Less: Sales returns and allowances	12,000	14250
Net sales		211,350
Cost of goods sold		74,500
Gross profit		136,850
Expense
Selling expenses
Sales salaries expense	32,000
Rent expense - Selling space	8,000
Store supplies expense	1,500
Advertising expense	13,000
Total selling expenses		54,500
General and administrative expenses
Office salaries expense	28,500
Rent expense - Office space	3,600
Office supplies expense	400
Total general and administrative expenses		32,500
Total expenses		87,000
Net income		49,850
4
VALLEY COMPANY
Income Statement
For Year Ended August 31
Net sales		211,350
Expenses
Cost of goods sold	74,500
Selling expenses	54,500
General and administrative expenses	32,500
Total expenses		161,500
Net income		49,850