Junker's Stash started the Year 2 accounting period with the balances given in the financial statements model shown below. During Year 2, Junker's Stash experienced the following business events: 1. Paid cash to purchase $80,000 of merchandise inventory 2. The goods that were purchased in Event 1 were delivered FOB destination. Freight costs of $1,600 were paid in cash by the responsible party 3a. Sold merchandise for $87,000 under terms 1/10, n/30 3b. Recognized $46,900 of cost of goods sold 4a. Junker's Stash customers returned merchandise that was sold for $2,300 4b. The merchandise returned in Event 4a had cost Junker's Stash $1,350 5. The merchandise in Event 3a was sold to customers FOB destination. Freight costs of $1,750 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 $7100 for selling and administrative expenses. 8. Sold the land for $9,600 cash. Required a. Record the above transactions in a financial statements model. The first event is recorded as an example 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? Kecora tne aDove transactions n a nnancial Statements rnoael. Ine nrst event IS recoraea as an example. un cre Lasn row column, use uto aesignate operating activit activity, NC for net change in cash and NA to indicate the element is not affected by the event. Enter any decreases to account balances and cash outflows with a minus s JUNKER'S STASH Financial Statements Model Balance Sheet Income Statement Revenuel Gain Expense Loss Statement of Cash Flow Assets Stockholders' Equity Net Income - Event No Accounts Receivable Retained Earnin Land Cash+ 90,000+ 1. (80,000)+ +Inventory + 16,000+ 80,000+ Stock Beg. bal. 13,000 80,000+ 39,000 NA (83,000) NA NA NA NA NA 87,000+ 87,000 (46,900) (2,300) 1,350 (1,750) 87,000- 87,000 46,900(46,900) (2,300) 1,350 3b (46,900)+ (2,300) + (2,300)- 1,350+ (1,350) 1.750 4b (1,750)+ (1,750) 1,70 OA 6a 6b End. bal. 8,250+ 84,700+ 50,450 13,000 80,000+ 76,400 84,700 47,300 37,400 (84,750) K Required A Required B > Determine the amount of net sales. (Round your answer to 1 decimal place.) Net sales JUNKER'S STASH Income Statement For the Year Ended December 31, Year 2 0.0 | 0.01% Operating expenses 0.01 % 0.01% Total operating expenses 0.0 0.0 Non-operating items $0.0 0.01%, 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? The expenses for Junker's Stash Increase or decrease in Year 2 Determine the amount of net sales. (Round your answer to 1 decimal place.) Net sales JUNKER'S STASH Income Statement For the Year Ended December 31, Year 2 0.0 | 0.01% Operating expenses 0.01 % 0.01% Total operating expenses 0.0 0.0 Non-operating items $0.0 0.01%, 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? The expenses for Junker's Stash Increase or decrease in Year 2
