Compute the missing amounts. ABC Company XYZ Company Sales $ 200,000 (D) Cost of
ID: 2474850 • Letter: C
Question
Compute the missing amounts.
ABC Company XYZ Company
Sales $ 200,000 (D)
Cost of Goods Sold
Beginning Inventory (A) 60,000
Purchases and Freight-In 118,000 (E)
Cost of goods available for sale (B) 180,000
Ending inventory 4,000 4,000
Cost of goods sold 120,000 (F)
Gross Margin 80,000 224,000
Selling and Administrative Expenses (C) 170,000
Operating Income 24,000 (G)
Explanation / Answer
Particulars
ABC
XYZ
Sales
$ 200,000
$ 400,000
Less:Cost of Goods Sold
Beg Inventory
$ 6,000
$ 60,000
Purchases and Freight in
$ 118,000
$ 120,000
Cost of Goods Available for Sale
$ 124,000
$ 180,000
Less:Ending Inventory
$ 4,000
$ 4,000
Cost of Goods Sold
$ 120,000
$ 176,000
Gross Margin
$ 80,000
$ 224,000
Selling and Administrative Exp
$ 56,000
$ 170,000
Operating Income
$ 24,000
$ 54,000
B= Cost of Goods Available for Sale= Ending Inventory+ Cost of Goods Sold
=$4,000+$120,000
=$124,000
A=Beginning Inventory + Purchases= Cost of Goods Available for Sale
Beginning Inventory +$118,000=$124,000
Beginning Inventory=$124,000-$118,000=$6,000
C= Selling and Administrative Exp= Gross Margin- Operating Income
=$80,000-$24,000
=$56,000
E=Purchases and Freight in= Cost of Goods Available for Sale- Beg Inventory
=$180,000-$60,000
=$120,000
F= Cost of Goods Sold= Cost of Goods Available for Sale- Less:Ending Inventory
=$180,000-$4,000
=$176,000
D= Sales = Cost of Goods Sold + Gross Profit
=$176,000+ 224,000
=$400,000
G= Operating Income= Gross Margin- Selling and Administrative Exp
=$224,000-$170,000
=$54,000
Particulars
ABC
XYZ
Sales
$ 200,000
$ 400,000
Less:Cost of Goods Sold
Beg Inventory
$ 6,000
$ 60,000
Purchases and Freight in
$ 118,000
$ 120,000
Cost of Goods Available for Sale
$ 124,000
$ 180,000
Less:Ending Inventory
$ 4,000
$ 4,000
Cost of Goods Sold
$ 120,000
$ 176,000
Gross Margin
$ 80,000
$ 224,000
Selling and Administrative Exp
$ 56,000
$ 170,000
Operating Income
$ 24,000
$ 54,000
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