Question - The following amounts appeared on the Charles Company's adjusted trial balance as at October 31, 2010, the end of its fiscal year.
Debit Credit
Merchandise inventory.............................. 25,000
Other assets.............................................. 140,000
Liabilities................................................ $37,000
Charles, capital.......................................... 100,650
Sales...................................................... 210,000
Sales returns and allowances..................... 15,000
Sales discounts.......................................... 2,250
Purchases ................................................ 90,000
Purchases returns and allowances.................. 4,300
Purchase discounts....................................... 1,800
Transportation-in ....................................... 3,100
Sales salaries expense.............................. 28,000
Rent expense-selling space..................... 10,000
Rent expense-office space........................ 2,500
Store supplies expense.............................. 3,000
Advertising expense................................. 18,000
Office salaries expense.............................. 16,000
Office supplies expense............................... 900
Totals..................................................... $ 353,750 $ 353,750
A physical count shows that the ending inventory is $27,000.
Required:
(a) Calculate the company's net sales for the year.
(b) Calculate the company's cost of goods purchased for the year.
(c) Calculate the company's cost of goods sold for the year.
(d) Prepare a multiple-step income statement that lists the company's net sales, cost of goods sold, and gross profit, as well as the components and amounts of selling expenses and general and administrative expenses.