Accounting Midterm

Accounting Midterm - Basic Principles of Accounting TAKE...

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Basic Principles of Accounting TAKE HOME ASSIGNMENT Inventory Part A Problem 6-1A. 1) MULTIPLE-STEP INCOME STATEMENT For year ended March 31, 2008 Revenue from sales: Sales 1,542,000 Less: sales returns 27,720 Sales discounts 26,280 NET SALES 1,488,000 Cost of merch. sold 930,000 Gross Profit 558,000 Operating Expenses: Selling : Sales salaries expenses 207,840 Advertising expense 52,560 Depr. expense – store equip. 7,680 Misc. selling expense 1,920 Total selling exp: 270,000 Administrative Exp: Office salaries expense: 100,980 Rent expense: 37,620 Depr. expense – office equip. 15,240 Insurance expense: 4,680 Office supplies expense: 1,560 Misc. administrative expense: 1,920 Total admin. exp: 168,000 Total operating expenses: 438,000 Income from Operations 120,000 Other Income and Expense Interest Revenue (6,000) NET INCOME 114,000 2) STATEMENT OF OWNER’S EQUITY For Year Ended March 31, 2008 Tiffany Garland, capital April 1, 2007 564,900 Net income for year 114,000 Less Withdrawals 42,000 Increase in Owner’s Equity 72,000
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Tiffany Garland, capital March 31, 2008 636,000 3) BALANCE SHEET March 31, 2008 ASSETS Current Assets: Cash 184,500 Accounts Rec. 145,200 Merch Inventory 210,000 Office supplies 6,720
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