Question

The following information was taken from the accounting records of Northern Lights for the month of October, 20--: Sales $344,000 Sales Returns and Allowances 3,410 Sales Discounts 370 Purchases 194,500 Purchases Returns and Allowances 9,740 Purchases Discounts 5,560 Freight-In 1,580 Merchandise Inventory, October 1 42,000 Merchandise Inventory, October 31 33,000 Complete a partial income statement for the month of October, showing gross profit. Northern Lights Income Statement (partial) For the month ended October 31, 20- Sales Sales returns and allowances Sales discounts Net sales Cost of goods sold: Merchandise inventory, October 1 Purchases

Answer 1

$ 344,000 $ $ 3,410 370 $ $ 3,780 340,220 $ 42,000 Northern Lights Income Statement (partial) For the month ended October 31, 20- Sales Sales returns and allowances Sales discounts Net Sales Cost of goods sold: Merchandise inventory, October 1 Purchases $ 194,500 Purchase returns and allowances $ 9,740 Purchase discounts $ 5,560 $ 15,300 Net Purchases $ 179,200 Freight-in $ 1,580 Cost of goods purchased Goods available for sale Merchandise inventory, October 31 Cost of goods sold Gross profit $ 180,780 $ 222,780 $ 33,000 $ $ 189,780 150,440