The following information was taken from Jackson Company\'s accounting records f
ID: 2424706 • Letter: T
Question
The following information was taken from Jackson Company's accounting records for 2007:
sales revenue ............................. $247,000
freight-in ................................ 15,000
purchase returns .......................... 8,000
rent expense .............................. 28,000
beginning inventory ....................... 22,000
bad debt expense .......................... 19,000
purchases ................................. 86,000
cost of goods sold ........................ ?
freight-out ............................... 10,000
sales discounts ........................... 12,000
allowance for doubtful accounts ........... 18,000
purchase discounts ........................ ?
income tax expense ........................ 24,000
ending inventory .......................... 17,000
Jackson Company reported a net income of $65,000 for 2017.
Calculate the amount of purchase discounts reported by Jackson Company during 2017. Do not use decimals in your answer.
Explanation / Answer
Calculation Of Gross profit Net income 65,000 Income Tax Expense 24,000 Net income Before Tax 89,000 Rent expense 28,000 Bad Debt Expense 19,000 Freight Out 10,000 Total Expenses 57,000 Gross profit 146,000 Calculation of Cost of goods Sold Sales 247,000 less: Sales Discounts 12,000 Net Sales 235,000 Less: Gross Profit 146,000 Cost of Goods Sold 89,000 Calculation of Purchase Discounts Inventory at the begining 22,000 Purchases 86,000 Less: Purchase returns (8,000) 78,000 Less: Ending Inventory (17,000) Add: Freight In 15,000 Total 98,000 Less: Cost of Goods Sold 89,000 Purchase Discounts 9,000
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