Question 1 Merchandise Inventory $ 250,000 Cost of goods sold $ 1,523,000 Insura
ID: 2774355 • Letter: Q
Question
Question 1
Merchandise Inventory
$ 250,000
Cost of goods sold
$ 1,523,000
Insurance expense
$ 100,000
Land
$ 100,000
Bond financing
$ 400,000
Advertising expense
$ 145,000
Sales
$ 2,486,000
Taxes payable
$ 26,000
Equipment
$ 445,000
Cash
$ 79,000
A/Receivable
$ 120,000
Sales Salary expense
$ 240,000
Office salary expense
$ 165,000
Short term investments
$ 65,000
Buildings
$ 750,000
A/Payable
$ 164,000
Notes payable
$ 75,000
Common stock
$ 475,000
Retained earnings
$ 544,000
Accumulated depreciation
$ 125,000
Depreciation expense
$ 102,000
Supplies expense
$ 26,000
Use the account info to directly solve for the answers. Be sure to show the calculations and accounts involved.
Gross profit/margin (in $)= __________
Total long-term assets = __________
Total liabilities = _______________
Income before taxes= ____________
Total Equity = ________________
asap please
Explanation / Answer
Gross profit margin =( sales - COGS)/ sales = (2,486,000 - 1523000)/2,486,000 = 0.3873
Total long term assets = bulidings + equipments - accumulated depreciation + land = 750000 + 445000 - 125000 + 100000= 1170000
Total liabilities = Bond financing + Taxes payable + A/Payable + Notes payable
75,000 + 164,000 + 26,000 + 400,000
= 665000
Income before taxes = sales - cogs - insurance expense - advertising expense - sales salary expenses - depreciation expense - supplies expense
= 2,486,000 - 1523000 - 100000 - 145000 - 240000 - 165000 - 102000 - 26000
= 185000
Total equity = Common stock + Retained earnings
=$ 475,000 +$ 544,000 = 1019000
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