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Igoryamba
3 years ago
14

Ballard Company uses the perpetual inventory system. The company purchased $16,000 of merchandise from Andes Company under the t

erms 2/10, net/30. Ballard paid for the merchandise within 10 days and also paid $500 freight to obtain the goods under terms FOB shipping point. All of the merchandise purchased was sold for $30,000 cash. What is the amount of gross margin that resulted from these business events?
Business
1 answer:
Nataly_w [17]3 years ago
5 0

Answer:

$13,820

Explanation:

The computation of the amount of gross margin is shown below:

As we know that

Gross profit = Sales revenue - cost of goods sold

where,

Sales revenue = $30,000

And, the cost of goods sold

= Purchase value - purchase discount + freight charges

= $16,000 - $16,000 × 2% + $500

= $16,000 - $320 + $500

= $16,180

So, the amount of the gross margin is

= $30,000 - $16,180

= $13,820

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Read 2 more answers
Exercise 12-1
exis [7]

Answer: Please refer to Explanation

Explanation:

In the Cashflow statement, entries are classified by what type they are under Investing, Financing or Operating Activities.

Operating Activities refer to cash paid or received from normal business operations and the expenses needed to maintain it.

Investing Activities refer to entries made relating to cash paid for the acquisition of fixed assets as these are long term. It also includes buying other company stocks and bonds.

Financing Activities refer to the funds that the the business uses to fund itself. These include long term debt and Equity.

a. Collected cash from customers. OPERATING ACTIVITY.

b. Paid cash to repurchase its own stock. FINANCING ACTIVITY.

c. Borrowed money from a creditor. OPERATING ACTIVITY.

d. Paid suppliers for inventory purchases. OPERATING ACTIVITY.

e. Repaid the principal amount of a debt. FINANCING ACTIVITY.

f. Paid interest to lenders. FINANCING ACTIVITY.

g. Paid a cash dividend to stockholders. FINANCING ACTIVITY.

h. Sold common stock. FINANCING ACTIVITY.

i. Loaned money to another entity. INVESTING ACTIVITY.

j. Paid taxes to the government. OPERATING ACTIVITY.

k. Paid wages and salaries to employees. OPERATING ACTIVITY.

l. Purchased equipment with cash. INVESTING ACTIVITY.

m. Paid bills to insurers and utility providers. OPERATING ACTIVITY.

4 0
3 years ago
Chocolate Supreme purchased new baking equipment for $15,000 subject to terms 4/10, n/45. The discount was taken. Additional cos
4vir4ik [10]

Answer:

Cost of machine  =$ 15600

Explanation:

<em>According to International Accounting standards (IAS) 16 property plan and equipment (PPE), the cost of an asset is the purchase cost plus other costs of bringing it to the intended working conditions.</em>

So we will add the purchase cost to the cost of delivery, tax and installation.

Note the discount is 4%

The purchase cost less discount = (100-4)% × 15,000= $14,400

The cost of the equipment = $14,400 + 900 + 300

=$ 15,600

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3 years ago
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