Question

Root Brush Company sells standard hair brushes. The following information summarizes Root's operating activities for 2018: (Click the icon to view the information.) - X Data Table Requirements 1. Calculate the operating income for 2018. 2. Root sold 6,100 brushes in 2018. Compute the unit cost for one brush. $ Selling and Administrative Expenses 36,234 Requirement 1. Calculate the operating income for 2018. Purchases 65,880 Root Brush Company Income Statement Net Sales Revenue Merchandise Inventory, January 1, 2018 Merchandise Inventory, December 31, 2018 109,800 9,760 16,348 Year Ended December 31, 2018 Revenue: Print Done Cost of Goods Sold: Choose from any list or enter any number in the input fields and then click Check Answer.

Answer 1

Solution:

1.

Income statement

Root Brush Company
Income statement
Year End December 31,2018
Revenue
Sales revenue		1,09,800
Cost of goods sold:
Beginning merchandise inventory	9,760
Add: Purchases	65,880
Cost of goods available for sale	75,640
Less: Ending merchandise inventory	16,348
Cost of goods sold (75640 - 16348)		59,292
Gross profit (109800 - 59292)		50,508
Selling and administrative expenses		36,234
Operating Income (50508 - 36234)		14,274

2.

Unit cost for one brush = cost of goods sold / units = 59292 / 6100 = 9.72