Question
In: Finance
A retailer has yearly sales of $650,000. Inventory on January 1 is $260,000 (at cost). During...
A retailer has yearly sales of $650,000. Inventory on January
1 is $260,000 (at cost). During the year, $500,000 of merchandise
(at cost) is purchased. The ending inventory is $265,000 (at cost).
Operating costs are $90,000.
a. Calculate the cost of goods sold
b. Calculate the net profit
Solutions
Expert Solution
A.Cost of goods sold= ( opening inventory+purchase -closing inventory)
=( 260000+500000-265000)
= $ 495,000
B. Net profit= [ Sales-( purchase+ opening inventory-closing inventory)-operating cost)
= [650000-(500000+260000-265000)-90,000]
=[ 650000-495000-90000]
= $ 65000
Or Net profit= [ Revenues- Cost of good sold- Operating expenses]
= [650000-495000-90000]
= $ 65000
jeff jeffy answered 2 years agoRelated Solutions
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Question # 1: A retailer has yearly sales of $650,000. Inventory
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PREPARE STATEMENT OF COMPREHENSIVE INCOME :
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