[The following Information applies to the questions displayed below] Psymon Comp

Question

[The following Information applies to the questions displayed below] Psymon Company, Inc. sells construction equipment. The annual fiscal perlod ends on December 31. The following adjusted trial balance was created from the general ledger accounts on December 31: Account Titles Cash Accounts Recelvable Inventory Property and Equipment Accumulated Depreclation Liabilities Common Stock Retalned Earnings, January 1 Sales Revenue Sales Returns and Allowances Sales DIscounts Cost of Goods Sold Salarles and Wages Expense Office Expense Interest Expenses Income Tax Expense Deblts $53,530 22,400 81,500 61,000 Credits $ 25,600 37,700 112,000 13,800 231,500 8100 0,200 124,400 21,400 22,400 3,100 12,570 Totals $420,600 $420,600

Explanation / Answer

2) Income statement :

Gross profit percentage = 88800*100/213200 = 41.7%

Sales 231500 Less: Sales Return and allowance (8100) Less: Sales discount (10200) Net sales 213200 Less:Cost of goods sold (124400) Gross profit 88800 Less; Operating expense Salary and wages expense (21400) Office expense (22400) Total operating expense (43800) Operating income 45000 Other revenue and gains Other expense and losses Interest expense (3100) Income before tax 41900 Less; Income tax (12570) Net income 29330

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