Question

Cr. P9.7 (LO 4) Groupwork (Gross Profit Method) On April 15, 2021, fire damaged the office and warehouse of Stanislaw Corporation. The only accounting record saved was the general ledger, from which the balance sheet data below was prepared. Stanislaw Corporation March 31, 2021 Dr. Cash $ 20,000 Accounts receivable 40,000 Inventory, December 31, 2020 75,000 Land 35,000 Buildings 110,000 Accumulated depreciation $ 41,300 Equipment Accounts payable 23,700 Other accrued expenses 10,200 Common stock 100,000 3,600

Answer 1

Beginning inventory Jan 1			$    75,000
Add:purchases
jan-mar			$    52,000
April
cash		$    3,400
credit		$ 15,600
		$ 19,000
Less:returned	$        950
in transit	$    2,300	$    3,250	$    15,750
total goods available for sale			$ 142,750
Less:cost of goods sold			$    88,550
Inventory in stock on apr 15			$    54,200
Less:goods saved and sold			$      3,500
Loss of inventory due to fire			$    50,700

Workings:

Overall computation for two years
Sales		$ 920,000
Less: Cost of goods sold
Beginning Inventory	$    66,000
Add: Purchases	$ 515,000
Total goods available	$ 581,000
Less: Ending Inventory	$    75,000
Cost of goods sold		$ 506,000
Gross Profit		$ 414,000
Gross Profit Percentage		45.00%

Accounts receivable
cash deposited	$ 12,950
less:refund	$        950
Cash recd from debtors		$ 12,000
closing balane of debtors
acknowledge	$ 46,000
unacknowledge	$    8,000	$ 54,000	$    66,000
less:balance of march 31			$    40,000
Sales			$    26,000
Add:sales from jan to march			$ 135,000
sales from jan to apr			$ 161,000
Less:gross profit			$    72,450
cost of goods sold			$    88,550