Check VIIVICSGIC LICILIQITUISCI CHI CUCIS LOHICH IS SICH HILIGITUICIDEICOH DIES UILIIGITUISCHUTECW LUURS to Readers' Corner are made with terms n/30, and the two companies use perpetual inventory systems. Assume the following transactions between the two companies occurred in the order listed during the year ended August 31 a. New Books sold merchandise to Readers' Corner at a selling price of $550,000. The merchandise had cost New Books $415,000 b. Two days later, Readers' Corner complained to New Books that some of the merchandise differed from what Readers Corner had ordered New Books agreed to give an allowance of $10,000 to Readers' Corner Readers' Comer also returned some books, which had cost New Books $2,000 and had been sold to Readers' Comer for $3,500. c. Just three days later, Readers' Comer paid New Books, which settled all amounts owed. Required: 1. For each of the events (a) through (c), indicate the amount and direction of the effect on New Books in terms of the following items. (Enter any decreases to account balances with a minus sign.) Gross Profit Sales Cost of Goods Sold Net Sales Sales Returns Allowances Sales Revenues Transaction b [The following information applies to the questions displayed below.) Hair World Inc. is a wholesaler of hair supplies. Hair World uses a perpetual inventory system. The following transactions (summarized) have been selected for analysis 4 $51,200 a. sold merchandise for cash (cost of merchandise $28,797). b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) for cash refund (original cost of merchandise $360) c. Sold merchandise (costing $4,750) to a customer on account with terms n/60. d. Collected half of the balance owed by the customer in (c), e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid. 600 19,800 5,000 160 ok Required: 1. Compute Net Sales and Gross Profit for Hair World. Net Sales Gross Profit Hair World Inc. is a wholesaler of hair supplies. Hair World uses a perpetual inventory system. The following transactions (summarized) have been selected for analysis: $51,200 a. Sold merchandise for cash (cost of merchandise $28,797). b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) for cash refund (original cost of merchandise $360) c. Sold merchandise (costing $4,750) to a customer on account with terms, n/68. d. Collected half of the balance owed by the customer in (c). e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid. 609 10,000 5,000 160 2. Compute the gross profit percentage. (Round your answer to 1 decimal place.) Gross Prolit Percentage % Hair World Inc. is a wholesaler of hair supplies. Hair World uses a perpetual inventory system. The following transactions (summarized) have been selected for analysis: $51,200 a. Sold merchandise for cash (cost of merchandise $28,797). b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) for cash refund (original cost of merchandise $360). c. Sold merchandise (costing $4,750) to a customer on account with terms n/60. d. Collected half of the balance owed by the customer in (c). e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid. 609 10,000 5,000 160 4. Hair World is considering a contract to sell merchandise to a hair salon chain for $15,000. This merchandise will cost Hair World $10,000. What would be the increase or decrease) to Hair World's gross profit and gross profit percentage? (Round "Gross Profit Percentage" to 1 decimal place.) by Gross Profit Gross Profit Percentage to Big Tommy Corporation is a local grocery store organized seven years ago as a corporation. The bookkeeper prepared the following statement at year-end (assume that all amounts are correct, but note the incorrect format) BIG TOMMY CORPORATION Profit and loss December 31 Debit Credit $494,000 Net Sales Cost of Goods Sold Salaries and Wages Expense Office Expenses Travel Expenses Income Tax Expense Net Profit Totals $ 279,000 58.000 16,000 1 1,000 15,000 35,000 $404,000 $404,000 2. Compute the gross profit percentage. (Round your answer to 1 decimal place.) Gross Profit Percentage %
