Question

Consider the following partially completed income statements for merchandising companies and compute the missing​ amounts under the Flynt Corp. table below the following Data Table:view the Income​ Statements:Data Table :Rustic Gear Flynt Corp. Sales$ 98,000 $(d)Cost of Goods Sold:Beginning Merchandise Inventory(a)31,000Purchases and Freight In50,000(e)Cost of Goods Available for Sale(b)91,000Ending Merchandise Inventory(2,200)(2,200)Cost of Goods Sold63,000(f)Gross Profit35,000114,000Selling and Administrative Expenses(c)86,000Operating Income$10,000$(g)Rustic GearSales$98,000Cost of Goods Sold:Beginning Merchandise Inventory15,200Purchases and Freight In50,000Cost of Goods Available for Sale65,200Ending Merchandise Inventory(2,200)Cost of Goods Sold63,000Gross Profit35,000Selling and Administrative Expenses25,000Operating Income$10,000Flynt Corp.__?___$31,000__?___91,000(2,200)114,00086,000__?____

Answer 1

Answer:

e. Purchases & freight= 60,000

f. Cost of goods sold= 88,800

d. Sales= 202,800

g.Operating income= 28,000

Explanation:

Calculation for the missing amounts for Flynt Corp.

e. Computaion for Purchases & freight-in

Using this formula

Purchases & freight-in= Cost of Goods Available for Sale - Beginning Merchandise Inventory

Let plug in the formula

Purchases & freight= 91,000 - 31,000

Purchases & freight= $ 60,000

f. Computation for Cost of goods sold

Using this formula

Cost of goods sold = Cost of Goods Available for Sale - Ending Merchandise Inventory

Let plug in the formula

Cost of goods sold= 91,000 - 2,200

Cost of goods sold= 88,800

d. Computation for Sales

Using this formula

Sales = Gross profit + Cost of goods sold

Let plug in the formula

Sales= 114 000 + 88,800

Sales= 202,800

g. Computation for Operating income

Using this formula

Operating income = Gross profit - Selling and Administrative Expenses

Let plug in the formula

Operating income= 114,000 - 86,000

Operating income= 28,000

Preparation for the Income statement for Flynt Corp.

Flynt INCOME STATEMENT

Sales 202,800 (i)

Cost of good sold :

Beginning Merchandise Inventory 31,000

Purchases and Freight In 60,000

Total Cost of goods available for sale 91,000

(60,000+31,000)

Less Ending Merchandise Inventory 2,200

Cost of goods sold 88,800 (ii)

(91,000-2,200)

Gross profit 114,000

(202,800 - 88,800)

Less Selling & Administrative expenses 86,000

Operating income 28,000