Answer for an income statement

Question

At the end of Oates Department Store’s fiscal year on November 30, 2022, these accounts appeared in its adjusted trial balance.

Freight-In	$ 5,060
Inventory (beginning)	41,300
Purchases	613,000
Purchase Discounts	7,000
Purchase Returns and Allowances	6,760
Sales Revenue	902,000
Sales Returns and Allowances	20,000

Additional facts:

1.	Inventory on November 30, 2022, is $36,200.
2.	Note that Oates Department Store uses a periodic system.

Prepare an income statement through gross profit for the year ended November 30, 2022.

Answer 1

Oates Department Store

Income Statement

For the fiscal year ended November 30, 2022

Sales Revenue $902,000

less Sales Returns and Allowances ( 20,000)

Net Sales Revenue $882,000

less Cost of Goods Sold

Inventory (beginning) 41,300

Add Purchases 613,000

Add Freight 5,060

Less Purchase Discounts (7,000)

Less Purchase Returns and Allowances (6,760)

Net Purchases 604,300

Cost of Goods Available for Sale 645,600

Less Inventory (ending) ( 36,200)

Cost of Goods Sold 609,400

Gross Profit $272,600