Question

Slipper Electric uses the periodic inventory system. Slipper reported the following selected amounts at May 31​, 2018​: LOADING...​(Click on the icon to review the​ data.) Compute the following for Slipper​: a. Cost of goods sold. b. Gross profit. a. Compute the cost of goods sold. Cost of Goods Sold: Less: Plus: Less: Cost of Goods Sold Choose from any list or enter any number in the input fields and then click Check Answer. 1 part remaining Data Table Merchandise Inventory, June 1, 2017 $16,500 Freight In $5,000 Merchandise Inventory, May 31, 2018 24,500 Net Sales Revenue 173,000 Purchases 84,000 Common Stock 16,000 Purchase Discounts 6,500 Retained Earnings 10,000 Purchase Returns and Allowances 8,000

Answer 1

Question a) Cost of goods sold

Cost of goods sold = Opening Merchandise + Cost of goods Purchased - Closing Merchandise

Cost of goods purchased = Purchases + Frieght In - Purchase discounts - Purchase returns and allowances

Cost of goods purchased = 84,000 + 5,000 - 6,500 - 8,000

Cost of goods purchased = $74,500

Cost of goods sold = 16,500 + 74,500 - 24,500 = $66,500

Cost of goods sold = $66,500

b) Gross profit

Gross profit = Net sales - cost of goods sold

Gross profit = 173,000 - 66,500

Gross profit = $106,500