Question

Flounder Corp. uses a periodic inventory system and reports the following information: sales $1,840,000; sales returns and allowances $125,000; sales discounts $29,000; purchases $879,000; purchase returns and allowances $12,000; purchase discounts $15,000; freight in $14,000; freight out $41,000; beginning inventory $99,000; and ending inventory $78,000. Assuming Flounder uses a multiple-step income statement Calculate net sales Net sales $ Calculate net purchases. Net purchases $ Calculate cost of goods purchased. Cost of goods purchased 5 Calculate cost of goods sold. Cost of goods sold $

Answer 1

Computation of Net Sales
Sales	$1,840,000.00
Less: Sales Return	-$125,000.00
Less: Sales Discont	-$29,000.00
Net Sales	$1,686,000.00
Computation of Net Purchase
Purchase	$879,000.00
LessL Purchase Return	-$12,000.00
Less: Purchase Discount	-$15,000.00
Net Purchase	$852,000.00
Computation of Goods Purchased
Net Purchase	$852,000.00
Freight in	14000
Cost of Goods Purchased	$866,000.00
Compuation of Cost of Goods Sold
Beginning Inventory	$99,000.00
Cost of Goods Purchased	$866,000.00
Less: Ending Inventory	-$78,000.00
Cost of goods Sold	$887,000.00