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Musya8 [376]
2 years ago
15

Sample T-Shirt Company, INC. needs help with their profit loss statement for their fourth quarter which lasts between October 1s

t and December 31st. They have sold 14,320 t-shirts this quarter at $20 a shirt. These shirts cost $3 to make. Of all of the shirt orders, 80 percent are shipped to customers. The company offers free shipping, so they must pay an average of $4 in postage per shirt shipped. The company has three employees who each make $80,000 a year. The company has general liability insurance which costs $600 a year, with equal payments every month. The company rents out a small production space for $600 a month. Each month the company pays $300 for web advertising, $200 for print advertising and $500 for television advertising. The company pays 15 percent of their profit in taxes.
Business
1 answer:
vfiekz [6]2 years ago
8 0

The preparation of the fourth quarter, October 1st to December 31st profit and loss statement for T-Shirt Company, INC., is as follows:

T-Shirt Company, INC.

<h3>Profit and Loss Statement</h3>

For the fourth quarter ended December 31

Sales revenue                        $286,400

Cost of goods sold                   (42,960)

Gross profit                            $243,440

Rental income                              1,800

Total income                         $245,240

Expenses:

Freight-out              $45,824

Salaries                     60,000

Insurance Expense        150

Advertising expense 2,950  (108,924)

Income before taxes             $136,316

Income tax rate (15%)              20,447

Net income                         $115,869

<h3>What is the profit and loss statement?</h3>

The profit and loss statement also known as the income statement is a periodic financial statement that summarizes the revenues, costs, and expenses for the specified period.

The statement is used to determine the profit or loss during the stated period.

<h3>Data and Calculations:</h3>

Number of shirts sold = 14,320

Selling price per t-shirt = $20

Sales revenue = $286,400 (14,320 x $20)

Product cost per t-shirt = $3

Cost of goods sold = $42,960 ($3 x 14,320)

Freight-out to customers = $45,824 ($4 x 14,320 x 80%)

Salaries Expense of employees for the quarter = $60,000 ($80,000 x 3 x 1/4)

General Liability Insurance Expense = $150 ($600/4)

Rental income for the quarter = $1,800 ($600 x 3)

Web = $900 ($300 x 3)

Print = $400 ($200 x 3)

Television = $1,500 ($500 x 3)

Advertising expense = $2,950

Income tax rate = 15%

Learn more about the profit and loss statement at brainly.com/question/24498019

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