Jones Inc Lee Supply Net Sales Revenue 99000 Cost of Goods S

Jones, Inc. Lee Supply Net Sales Revenue 99,000 Cost of Goods Sold Beginning Merchandise Inventor Purchases and Freight In Cost of Goods Available for Sale Ending Merchandise Inventory Cost of Goods Sold 31,000 51,000 92,000 (1,900) (1,900) 60,000 39,000 Gross Profit Selling and Administrative Expenses Operating Income 113,000 87,000 14,000

Solution

Solution: a. Beginning Merchandise Inventory 10,900 Working Notes: Cost of goods available for sale = Beginning Merchandise Inventory + Purchases and Freight In 61,900 (from b ) = Beginning Merchandise Inventory + 51,000 Beginning Merchandise Inventory = 61,900 - 51,000 Beginning Merchandise Inventory = 10,900 b. Cost of goods available for sale 61,900 Working Notes: Cost of goods available for sale - Ending Merchandise Inventory = cost of goods sold Cost of goods available for sale -1900 = 60,000 Cost of goods available for sale = 60,000 + 1900 = 61,900 c. selling and administrative expenses 25,000 Working notes: Gross profit - selling and administrative expenses = Operating Income 39,000 - selling and administrative expenses = 14,000 selling and administrative expenses = 39,000 -14,000 = 25,000 d. Net sales revenue 203,100 Working Notes Net sales revenue - cost of goods sold (f) = Gross profit Net sales revenue - 90,100 = 113,000 Net sales revenue = 90,100 + 113,000 =203,100 e. Purchase and freight In 61,000 Working Notes: Cost of goods available for sale = Beginning Merchandise Inventory + Purchases and Freight In 92,000 = 31,000 + Purchases and Freight In Purchases and Freight In = 92,000-31,000 Purchases and Freight In = 61,000 f. Cost of goods sold 90,100 Working Notes: Cost of goods available for sale - Ending Merchandise Inventory = cost of goods sold 92,000 - 1900 = cost of goods sold cost of goods sold = 90,100 g. Operating income 26,000 Working Notes: Gross profit - selling and administrative expenses = Operating Income $113,000 - 87,000 = Operating Income Operating Income = 26,000 Please feel free to ask if anything about above solution in comment section of the question.