Question

Baskin-Robbins is one of the world’s largest specialty ice cream shops. The company offers dozens of different flavors, from Very Berry Strawberry to lowfat Espresso ’n Cream. Assume that a local Baskin-Robbins in Raleigh, North Carolina, has the following amounts for the month of July 2021.

Salaries expense	$	11,900			Sales revenue	$	60,800
Inventory (July 1, 2021)		1,400			Interest income		1,500
Sales returns		1,200			Cost of goods sold		27,800
Utilities expense		2,700			Rent expense		4,900
Income tax expense		4,200			Interest expense		500
					Inventory (July 31, 2021)		1,200

Required:

1. Prepare a multiple-step income statement for the month ended July 31, 2021.
  

2-a. Calculate the inventory turnover ratio for the month of July.

3. Calculate the gross profit ratio for the month of July.

Answer 1

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