Question

I need help with these 3 questions, please

1)

Given below are account balances for Charlie Company:

Gross sales, $94,000

Sales returns and allowances, $4,000

Selling expenses, $12,000

Cost of goods sold, $60,000

Interest expense, $3,000

How much is the gross profit margin? (enter your percentage as a decimal rounded to two decimal places. Example - enter 46% as .46)

2) Alpha Company provided the following data concerning its income statement: sales, $1,040,000; purchases, $458,000; beginning inventory, $275,000; ending inventory, $287,000; operating expenses, $117,000; freight-in, $5,000; sales discounts, $27,000; purchases discounts, $15,000; sales returns & allowances, $131,000; and purchases returns & allowances, $35,000. The data are complete and provide the basis for preparation of an income statement. How much is net income?

3)

Alpha Company used the periodic inventory system for purchase & sales of merchandise. Discount terms for both purchase & sales are, FOB Destination, 2/10, n30 and the gross method is used.

> Alpha Company sold on account $2,500 of merchandise to Bravo Company on May 2, 2016. Selling price was $4,000. Freight charges related to this transaction of $150 were paid by Alpha Company.

> Bravo Company returned, to Alpha Company, $250 of this merchandise on May 3, 2016. Merchandise was sold for $400

Use this information to prepare Alpha Company's General Journal entries (without explanation) for May 2 & May 3 entries.

Answer 1

1)	Net Sales	($ 94000 - $ 4000)		$ 90,000.00
	Less:	COGS		$ 60,000.00
		Gross Margin		$ 30,000.00
		Gross Margin %		0.33
		($ 30000 / $ 90000)

2)	Sales					$ 1,040,000.00
	Less: Sales Returns and Allowance					$   (131,000.00)
	Less: Sales Discounts					$     (27,000.00)
	Net Sales					$    882,000.00
Less:	Expenses:
	Cost of Goods Sold:
	Beginning Inventory				$ 275,000.00
Add:	Net Purchase ($ 458000 - $ 35000 - $ 15000)				$ 408,000.00
Add:	Freight In				$      5,000.00
Less:	Ending Inventory				$(287,000.00)	$    401,000.00
	Operating Expenses					$    117,000.00
			Net Income			$    364,000.00

3)	Date	Particulars			Debit	Credit
	2-May	Accounts Receivable - Bravo Co.			$ 4,000.00
		To Sales				$ 4,000.00
		Freight Out			$    150.00
		To Cash				$    150.00
	3-May	Sales			$    400.00
		To Accounts Receivable - Bravo Co.				$    400.00