P5-6A (a-d)

P5-6A (a-d) - 2006 2007 2008 Sales $ 225700 $ 227600 $...

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ACC557062GA036-1116-001 / HW Chpt 5 P5-6A (a-d) Kristen Montana operates a retail clothing operation. She purchases all merchandise inventory on credit and uses a periodic inventory system. The accounts payable account is used for recording inventory purchases only; all other current liabilities are accrued in separate accounts. You are provided with the following selected information for the fiscal years 2005, 2006, 2007, and 2008. 2005 2006 $13,000 $11,300 20,000 225,700 146,000 135,000
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Correct. Calculate cost of goods sold for each of the 2006, 2007, and 2008 fiscal years. 2006 2007 2008 Beginning inventory $ 13000 $ 11300 $ 14700 Plus: Purchases 146000 145000 129000 Cost of goods available 159000 156300 143700 Less: Ending inventory 11300 14700 12200 Cost of goods sold $ 147700 $ 141600 $ 131500 Correct. Calculate the gross profit for each of the 2006, 2007, and 2008 fiscal years.
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Unformatted text preview: 2006 2007 2008 Sales $ 225700 $ 227600 $ 219500 Less: Cost of goods sold 147700 141600 131500 Gross profit $ 78000 $ 86000 $ 88000 Correct. Calculate the ending balance of accounts payable for each of the 2006, 2007, and 2008 fiscal years. 2006 2007 2008 Beginning accounts payable $ 20000 $ 31000 $ 15000 Plus: Purchases 146000 145000 129000 Less: Payments to suppliers 135000 161000 127000 Ending accounts payable $ 31000 $ 15000 $ 17000 Correct. Sales declined in fiscal 2008. Does that mean that profitability, as measured by the gross profit rate, necessarily also declined? Calculate the gross profit rate for each fiscal year. (Round answers to 1 decimal place, e.g. 10.5.) 2006 2007 2008 Gross profit rate 34.6 % 37.8 % 40. %...
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This note was uploaded on 07/31/2011 for the course ACCT 557 taught by Professor Kahn during the Spring '10 term at Strayer.

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P5-6A (a-d) - 2006 2007 2008 Sales $ 225700 $ 227600 $...

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