Question

Now that operations for outdoor clinics and TEAM events are running smoothly, Suzie thinks of another area for business expansion. She notices that a few clinic participants wear multiuse of most watches, MU watches are able to report temperature, altitude, and barometric pressure. MU watches are waterproof, so moisture from Kayaking, rain, fishing, or even diving up to 100 feet won't damage them. Suzie decides to have MU watches available for sale at the start of each clinic. The following transactions relate to purchases and sales of watches during the second half of 2022. All watches are sold for $498 each. Jul. 17 Purchased 48 watches for $7,104 (5148 per watch) on account. Jul. 31 Sold 38 watches for $18,924 cash. Aug. 12 Purchased 38 watches for $6,084 ($158 per watch) cash Aug. 22 Sold 28 watches for $13,944 on account Sep. 19 Paid for watches purchased on July 17. Sep. 27 Receive cash of $16,200 for watches sold on account on August 22 Oct. 27 Purchased 78 watches for $13,104 ($168 per watch) cash Nov. 20 Sold 88 watches for $43,824 Cash Dec. 4 Purchased 116 watches for $20,648 ($178 per watch) on account. Dec. 8 Sold 38 watches for $18,924 on account.

Answer 1

1) Calculation of cost of goods available for sale

Date		Units	Unit cost	Total costs
Jul 17	Purchases	48	$148	$7104
Aug 12	Purchases	38	$158	6004
Oct 27	Purchases	78	$168	13104
Dec 4	Purchases	116	$178	20648
	Total	280		$46860

Sales units= 38+28+88+38= 192

Sales= 192*$498= $95616

Ending inventory= Total units-Sales units

= 280-192= 88 units

Ending inventory= 88*$178= $15664

Cost of goods sold= Cost of goods available for sale-Ending inventory

= $46860-15664= $31196

Sales	$95616
Cost of goods sold	$31196
Ending inventory	$15664

2)

GREAT ADVENTURES, INC.
Partial Income Statement
For the Year Ended December 31, 2022
Sales	$95616
Cost of goods sold	(31196)
Gross profit	$64420