Question

b. Sales declined over the 3-year hiscal period, 2016-2020. DUS necessarily also declined? Explain, computing the gross profit rate and the profit margin (Net income + Sales revenue) for each fiscal year to help support your answer. (Round to one decimal place.) Journalize, post, and prepare trial balance and partial income statement using periodic approach. P5.8A (LO7) Financial Statement At the beginning of the current season on April 1, the ledger of Gage Pro Shop showed Cash $3,000, Inventory $4,000, and Owner's Capital $7,000. These transactions occurred during April 2020. GLS Apr. 5 7 10 12 Purchased golf bags, clubs, and balls on account from Tiger Co. $1,200, FOB shipping point, terms 2/10, n/60. Paid freight on Tiger Co. purchases $50. Received credit from Tiger Co. for merchandise returned $100. Sold merchandise on account to customers $600, terms n/30. Purchased golf shoes, sweaters, and other accessories on account from Classic Sportswear $450, terms 1/10, 1/30. Paid Tiger Co. in full. Received credit from Classic Sportswear for merchandise returned $50. Made sales on account to customers $600, terms n/30. Paid Classic Sportswear in full. Granted credit to customers for clothing that had flaws $35. Received payments on account from customers $600. 14 17 20 21 27 30 The chart of accounts for the pro shop includes Cash, Accounts Receivable, Inventory, Accounts Paya- ble, Owner's Capital, Sales Revenue, Sales Returns and Allowances, Purchases, Purchase Returns and Allowances, Purchase Discounts, and Freight-In. Instructions a. Journalize the April transactions using a periodic inventory system. b. Using T-accounts, enter the beginning balances in the ledger accounts and post the April transactions. c. Prepare a trial balance on April 30, 2020. d. Prepare an income statement through gross profit, assuming merchandise inventory on hand at April 30 is $4,824. C. Tot. trial balance $8,376 d. Gross profit $465

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Answer 1

Please hit LIKE button if this helped. For any further explanation, please put your query in comment, will get back to you. Parta Part b Date Account Debit Credit Cash Purchases Credit Debit Credit $ 1,200 Apr 5 Apr 5 Purchase Accounts Payable (To record purchase of merchandise) Debit Beginning Balance Apr 30 $ 3,000 $ 600 $ 1,200 Apr 7 Apr 12 Apr 21 S 50 $ 1,078 $ 396 Apr 12 Apr 5 Ending Balance $ 450 $ 1,200 $1,650 Ending Balance $ 2,076 $ 50 Apr 7 Apr 7 Freight Inward Cash (To record payment of freight) $ 50 Accounts Receivable Credit Purchases Return and allowance Debit Credit $ 100 $ 50 Apr 27 Apr 30 $ S Debit Beginning Balance Apr 10 Apr 20 Ending Balance 35 600 $ 100 Apr 9 Apr 17 Apr 9 Apr 9 Accounts Payable Purchase return and allowance (To record purchase return) $ $ $ $ - 600 600 565 $ 100 Ending Balance $ 150 $ 600 Inventory Purchase Discount Apr 10 Apr 10 Accounts Receivable Sales (To record sales) $ 600 Credit Debit Credit Debit Beginning Balance $ 4,000 $ 22 Apr 12 Apr 21 $ 450 Apr 12 Apr 12 Purchase Accounts Payable (To record purchase of merchandise) $ 450 Ending Balance $ 4.000 Ending Balance $ 26 Accounts Payable Freight in $ 1,100 Credit Debit Credit Apr 12 Apr 12 Apr 12 Apr 5 S 1.200 Apr 7 $ 50 Accounts Payable Purchase Discount Cash (To record payment made) $ 22 $ 1,078 Debit Apr 9 Apr 12 Apr 17 Apr 21 Ending Balance $ 100 $ 1,100 $ 50 $ 400 $ 450 Ending Balance $ 50 $ 50 Apr 17 Apr 17 Accounts Payable Purchase return and allowance (To record purchase return) $ 50 Owner's Capital Credit $ 600 Apr 20 Apr 20 Accounts Receivable Sales (To record sales) Debit Apr 9 Ending Balance $ 7,000 $ 7,000 $ 600 Sales $ 400 Debit Credit Apr 21 Apr 21 Apr 21 Accounts Payable Purchase Discount Cash (To record payment made) $ $ 4 396 Apr 10 Apr 20 $ $ 600 600 Ending Balance $ 1,200 $ 35 Apr 27 Apr 27 Sales return and allowance Accounts Receivable (To record sales return) $ 35 Sales return and allowance Debit Credit $ 35 Apr 27 S 600 Apr 30 Apr 30 Cash Accounts Receivable (To record cash received) $ 600 Ending Balance $ 35

Partc Beginning Credit April Credit Final Credit Account Debit Debit Debit $ 3,000 $ 924 $ 565 $ $ $ 2,076 565 4,000 $ 4,000 7,000 7,000 1,200 $ 1,200 Cash Accounts Receivable Merchandise Inventory Owner Capital Sales Sales return and allowance Purchase Purchase Discount Purchase return and allowance Freight Inward $ 1,650 $ 35 1,650 26 150 26 150 $ 50 $ 50 Total 7,000 $ 7,000 $ 2,300 $ 2,300 $ 8,376 $ 8,376 Part d $ $ $ 1,200 (35) 1,165 $ 4,000 $ 1,650 Sales Less: Sales Return and Allo Net Sale Less: Cost of Goods Sold: Beginning Inventory Add: Cost of Purchases: Purchases Less: Purchase Discount Purchase return and allowance Net Purchase Add: Freight inward Cost of purchases Cost of goods available for sale Less: Ending Inventory $ $ (26) (150) 1,474 50 $ 1,524 5,524 (4,824) $ $ (700) 465 Gross Profit