Identity and explainthe types of adjustment raised in each transaction entered into by ABC Ltd
Answer:
$67,600
Explanation:
income from operations = gross profit - operating expenses.
In this case, the income from operations = EBIT, it is not always that way because EBIT includes non-operating income, but in this case this doesn't exist.
Sales Revenue 320,000
- Sales Discounts 9,400
<u>- Sales Returns & Allowances 43,000 </u>
Net sales = 267,600
<u>- Cost of Goods Sold 153,000 </u>
gross profit = 114,600
- Advertising Expense 20,000
- Delivery Expense 7,600
- Insurance Expense 1,000
<u>- Rent Expense 18,400 </u>
income from operations = 67,600
Answer:
the predetermined overhead rate is $35.28
Explanation:
The computation of the predetermined overhead rate is given below:
The Predetermined overhead rate is
= Estimated overhead ÷ Capacity hours
= $2,836,512 ÷ 80,400 machine hours
= $35.28
hence, the predetermined overhead rate is $35.28
It's all depends on from where you are shipping the furniture from
Sometimes you will use Debit to increase an account (ie: Assets) and sometimes you will use Credits to increase an account (ie: Liabilities)