Hair Care Inc. is a wholesaler of hair supplies. Hair Care uses a perpetual inventory system. The following transactions $($summarized$)$ have been selected for analysis:

a$.$ Sold merchandise for cash $($cost of merchandise $$28,397)$ $ $50,800$

b$.$ Received merchandise returned by customers as unsatisfactory $($but in perfect condition$),$ for cash refund $($original cost of merchandise $$320)560$

c$.$ Sold merchandise $($costing $$4,550)$ to a customer, on account with terms $1/10,$ n$/3010,000$

d$.$ Collected half of the balance owed by the customer in $($c$)$ within the discount period $4,950$

e$.$ Granted an allowance to the customer in $($c$)140$

Required:

$1.$ Compute Sales Revenue, Net Sales, and Gross Profit for Hair World.

$2.$ Compute the gross profit percentage. $($Round your answer to the nearest whole percent.$)$

$3.$ Prepare journal entries to record transactions $($a$)($e$).($If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.$)$

$4.$ Hair Care is considering a contract to sell merchandise to a hair salon chain for $$14,600.$ This merchandise will cost Hair Care $$10,000.$

$($a$)$ Compute the new gross profit percentage. $($Round your answer to the nearest whole percent.$)$

$($b$)$ Would this contract increase or decrease Hair Care$$s gross profit percentage?

multiple choice

Increase

Decrease