Problem:
A retailer has yearly sales of $800,000. Inventory on January 1 is $300,000 (at cost). During the year, $600,000 of merchandise (at cost) is purchased. The ending inventory is $305,000 (at cost). Operating costs are $90,000.
Required:
Question: Calculate the cost of goods sold and net profit, and set up a profit-and-loss statement. There are no retail reductions in this problem.
Note: Please show the work not just the answer.