Question

The following is a list of the accounts and balances taken from the adjusted trial balance at December 31, 2021 for, Meilleur Merchants. The list of accounts is in alphabetical order. All accounts have normal balances. Meilleur uses a periodic inventory system and the earnings approach to recognize revenue. Account 1 Accounts payable 2 Accounts receivable 3 Accumulated depreciation-building 4 Accumulated depreciation equipment 5 Advertising expense 6 Building 7 S. Meilleur, capital 8 S. Meilleur, drawings 9 Cash 10 Depreciation expense 11 Equipment 12 Freight in 13 Freight out 14 Insurance expense 15 Interest expense 16 Interest revenue 17 Land 18 Merchandise inventory, beginning 19 Mortgage payable 20 Prepaid insurance 21 Property tax expense 22 Property taxes payable 23 Purchase discounts 24 Purchase returns and allowances 25 Purchases 26 Rent revenue 27 Salaries expense 28 Salaries payable Balance Dec. 31 $15.000 30,000 15,500 10,000 4,100 84,600 75.000 28,300 11,770 5,900 24,500 3.200 650 1,250 2,220 1,340 12.000 90,200 57,600 2,100 1.200 600 6,300 14,800 268.100 1.800 40.000 650

Answer 1

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Revenue:
Sales					$     423,900
Less:
Sales Discount				$       15,500
Sales return and allowance				$       17,900
					$     (33,400)
Net Sales Revenue					$     390,500
Less: Cost of Goods Sold
Merchandising Inventory, Beginning				$       90,200
Purchases			$     268,100
Less:
Purchase Discount		$     6,300
Purchase Return and allowance		$   14,800
			$     (21,100)
Net Purchases			$     247,000
Add: Freight in			$          3,200
net Cost of Purchases				$     250,200
Cost of goods available for sale				$     340,400
Merchandising Inventory, Ending				$   (104,500)
Cost of Goods Sold					$   (235,900)
Gross Margin					$     154,600
Less: Operating Expense
Advertising Expense				$          4,100
Freight out				$             650
Depreciation Expense				$          5,900
Insurance Expense				$          1,250
Property Tax Expense				$          1,200
Salaries Expense				$       40,000
Utilities Expense				$          2,000
Total Operating Expense					$     (55,100)
Operating Income					$       99,500
Other Revenue:
Interest Revenue			$          1,340
Rent Revenue			$          1,800
Total Other Revenue				$          3,140
Less: Other Expense
Interest Expense				$       (2,220)
Net Other revenue/Expense					$             920
Net Income					$     100,420