Mastery Problem Accounting for Retail Businesses Merchandising Transactions You are working as summer intertur MAA Austin, Inc. You have been to help resolve decrepancies nited in the audit for Dorin Corneration, a retailer of specialty aquarum supplies As a real company, Don Corporation uses the perimento autom. To prepare for this sitment, you have been asked to review your knowingo care and purchase transions by completing the sewing this Consider the effect of each transaction on the three accounts listed and ently which accounts are debited or credhod. not affected by the transaction, select "No tots Inventory Estimated Returns Inventory Coat of Good Sold Purchase al merchandise for sale Cashie of merchandise Customer ret Yearly estimate for customer retums Prepaid for merchandise purchased ping pont turmerchandise purchased for sale Bright for a wondestation Salut Catamaranton sunt Payment of ice fee for procesu cred card sales Auding Out Anerging the the accounting records of Dolfin Corporation in detail, the car made a list of servation. You have bed to review the effect of these tom for each of which tam the income statement are overstated or understated. If it wested by the abservation, select the "No her Observations Win the many content was onion, the cost of each sale was not recorded for Sales Cost of Goods sold Operating Expenses Gross Profit Operating Income reght costs were caged to Delivery Expense regardless of the terms of sale Customer returns and allowances were sometimes de tomated Returnstory and created 10 Sales Office les pense wanduted in administrative Set colected on each so was credited to cost of Goods sold try was crested to collateus Seling Expense Credit card processing were debuted to Cost of Goods Sold Income Statement The content for Dann Corporation prepared the following come statement. The auditor asked you to use a statement to provide additional formation to Dolfin Corporation on the Finar Questions, Delfin Corporation Income Statement For the Year Ended December 31, ova 5330,840 Expert Cost of gods sold $218.11 Selling en Adrienes expense 205 41,709 35.292 Total expenses 299.44) 925-193 Income Statement The accountant for Dottin Corporation prepared the following income statement. The auditor os asked you to use the statement to provide an informiento Delfin Corporation on the Fina Dolfin Corporation Income Statement For the Year Ended December 31, 2018 Sales $320,640 Expenses Cost of goods sold 5210,171 Selling expenses 41,709 Administrative expenses 35,292 Interest expense 275 Total expenses (295,447) Net income 525,393 Final Questions The auditor has asked you to prepare additional information about Dolfin Corporation's retults for the year is the data shown on the income statement in your computati 1. Compute the nerating expenses for Dolfin Corporation 2. Compute the gross profit for Dorin Corporation 3. Compute the operating income for Dolfin Corporation
