Question

Patterson Company had the following account balances at the end of the year:

Additional Resources

	Beginning Inventory	$37,000			Purchases Returns and Allowances	$4000
	Ending Inventory	42,600			Purchases	72800
	Freight-In	3,400			Sales Discounts	5800
	General and Administrative Expenses	15,400			Sales Returns and Allowances	5900
	Interest Revenue	1,840			Sales	197400
	Interest Expense	1,630			Selling Expenses	19800
	Purchase Discounts	3,600

Required:

Compute the following:

1. Cost of goods sold
2. Net income, given that income from operations is $87,500.

Answer 1

cost of goods sold = $ 63000

Net income = $ 87710