QUIZ+567+2011F - QUIZ Name_ Section_ Financial information...

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QUIZ Name________________________ Section__________________ Financial information is presented here for two companies. King Company Queen Company Sales $60,000 ? Sales Returns ? 5,000 Net Sales 54,000 62,000 Cost of Goods Sold 24,000 ? Gross Profit ? 38,000 Operating Expenses 8,000 ? Net Income ? 18,000 Instructions (a) Compute the missing amounts. (a) King Company Sales returns = $5,000 (60,000 – 55,000 = 5,000) Gross profit = $22,000 (55,000 – 33,000 = 22,000) Net income = $11,000 (22,000 – 11,000) Queen Company Sales revenue = $85,000 (80,000 + 5,000) Cost of goods sold = $42,000 (80,000 – 38,000) Operating expenses = $20,000 (38,000 – 18,000) (b) Name 3 operating expenses Depreciation Expense, Selling,General and Administrative Expenses, Advertising expenses, repairs and maintenance expenses, salaries expenses, utility expenses, etc.
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The following transactions are for Kale Company. (1) On December 3 Kale Company sold $450,000 of merchandise to Thomson Co., terms 1/10, n/10. The cost of the merchandise sold was $320,000. (2) On December 8 Thomson Co. was granted an allowance of $20,000 for merchandise purchased on December 3. (Kale gave Thomson an Allowance – sales return and allowance) (3) On December 13 Kale Company received the balance due from Thomson Co. Instructions (a) Prepare the journal entries to record these transactions on the books of Kale Company. Kale uses a perpetual inventory system. DR Accounts Receivable $450,000 CR Sales $450,000 DR Cost of Goods Sold $320,000 CR Inventory $320,000 Allowance: DR Sales Returns and Allowances $20,000 CR Accounts Receivable $20,000 (Note – allowance – take an amount off, for a quality issue, etc. No returned goods –therefore no Cost of Goods Sold/Inventory reversal.) Accounts Receivable now has a balance of $430,000 (450-20). Thompson paid the amount due within the
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This note was uploaded on 01/18/2012 for the course ACCT 207 taught by Professor Hudchinson during the Fall '08 term at University of Delaware.

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QUIZ+567+2011F - QUIZ Name_ Section_ Financial information...

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