A- During August, 2016, Vaughn’s Supply Store generated revenues of $61300. The

Question

A- During August, 2016, Vaughn’s Supply Store generated revenues of $61300. The company’s expenses were as follows: cost of goods sold of $35100 and operating expenses of $4200. The company also had rent revenue of $900 and a loss on the sale of a delivery truck of $1900.

Vaughn’s gross profit for August, 2016 is

$26200.

B- Sheridan Company had the following transactions during 2016:

Sales of $4800 on account

Collected $2100 for services to be performed in 2017

Paid $1600 cash in salaries

Purchased airline tickets for $270 in December for a trip to take place in 2017

Explanation / Answer

Gross profit = Sales-cost of goods sold

= 61300-35100

Gross profit = 26200

Net income = Sales-salary expense

= 4800-1600

Net income = 3200

so answer is d) 3200

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