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Junker's Stash started the Year 2 accounting period with the balances given in the following horizontal financial statements model. During Year 2, Junker's Stash experienced

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Junker's Stash started the Year 2 accounting period with the balances given in the following horizontal financial statements model. During Year 2, Junker's Stash experienced the following business events: 1. Paid cash to purchase $93,000 of merchandise inventory. 2. The goods that were purchased in Event 1 were delivered FOB destination. Transportation costs of $1,860 were paid in cash by the responsible party 3a. Sold merchandise for $106,500 under terms 1/10, n/30. 36. Recognized $53.400 of cost of goods sold. 4a. Junker's Stash customers returned merchandise that was sold for $2,560. 4b. The merchandise returned in Event 4a had cost Junker's Stash $1,480. 5. The merchandise in Event 3a was sold to customers FOB destination Transportation costs of $1,880 were paid in cash by the responsible party 6a. The customers paid for the merchandise sold in Event 3a within the discount period. Recognized the sales discount 6b. Collected the balance in the accounts receivable account 7. Paid cash of $7.425 for selling and administrative expenses. 8. Sold the land for $10,250 cash. Required a. Record the above transactions in a horizontal financial statements model b. Determine the amount of net sales c. Prepare a multistep income statement. Include common size percentages on the income statement d. The return-on-sales ratio for Junker's Stash during the prior year was 12 percent Based on the common size data in the income statement, did the expenses for Junker's Stash increase or decrease in Year 2? Assume sales are the same for both years. JUNKER'S STASH Financial Statements Model Balance Sheet Revenue Gain Income Statement Expense/ Loss = Not Income Statement of Cash Flow Cash Event No. Beg bal Assets Accounts Receivable Inventory 17,300 Land 15,600 Stockholders' Equity Common Retained Stock Earnings 93,000 42.900 100,000 1 . . 2 3b 4a 4b. 5 ba 65 7 8 End, bal 103.000 0 17.300 15,600 53,000 42.900 0 O 0 Determine the amount of net sales. (Round your intermediate calculations and final answer to 1 decimal place.) Net sales Prepare a multistep income statement. Include common size percentages on the income statement. (Round your answers to 1 decimal place.) JUNKER'S STASH Income Statement For the Year Ended December 31, Year 2 % % 0.0 0.0 % Operating expenses % % % 0.01% 0.01% Total operating expenses 0.0 0.0 Non-operating items % 0.0 % $ 0.0 The return-on-sales ratio for Junker's Stash during the prior year was 12 percent. Based on the common size data in the Income statement, did the expenses for Junker's Stash increase or decrease in Year 2? Assume sales are the same for both years. Did the expenses for Junker'n Stish Increase or decrease in Year 27

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