CP5-5

The following information is taken from the records of Smith Corp. at June 30, 2019, the fiscal yearend:

Advertising expense $ 1,500

Commissions expense 4,000

Cost of goods sold 50,000

Delivery expense 1,000

Insurance expense 1,000

Rent expense 2,500

Salaries expense 5,000

Sales (gross) 72,000

Sales returns and allowances 2,000

Required: 1. Prepare a classified income statement. Assume all expenses not related to cost of goods sold are selling expenses. 2. Compute gross profit percentage.