Case Study 3

Case Study 3 - Sister's salary 2,500 Total operating...

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Julie Rowe Income Statement From January 1, 2008 to December 31, 2008 Sales revenues Sales $87,000 Less: Returns 170 Net sales $86,830 Cost of goods sold Beginning Inventory $19,250 Purchased Inventory 35,000 Freight 2,000 Less: Ending Inventory 19,250 Total cost of goods sold 37,000 Gross margin 49,830 Operating expenses Truck expenses 5,900 Telephone expense 600 Depreciation expense 11,000
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Unformatted text preview: Sister's salary 2,500 Total operating expenses 20,000 Net operating income 29,830 Other expenses and losses Dad interest expense 500 Bank interest expense 13,000 13,500 Net income before taxes $16,330 Part 2 Initial investment $20,000 Interest revenue 1% savings if invested 20,200 Last years salary 36,130 56,330 Economic loss $(40,000)...
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