Module Two: Merchandising for a Profit Operating Income (Gross Sales and Net Sales) 1. Return Percentages: Customer returns and allowances for Department #620 came to $5,500. Gross sales in the department were $100,000. What percentage of merchandise sold was returned? Customer returns and allowances $5,500 Gross sales $100,000 Return Percentage 2. Net Sales $: If gross sales for Store A are $1,150,000 and reductions are $345,000, what are the net sales? Gross sales $ $1,150,000 Reductions $ $345,000 Net sales $ 3. Men's Store: If gross sales for Main Street Men's Store were $248,000 and the reduction % was 20%, calculate the following: a. The dollar amount of reductions b. The net sales Gross Sales $248,000 Reduction % 20% Dollar amount of reductions Net sales men's store 4. Loungewear Department: After Mother's Day this year, the loungewear department had customer returns of 8.5%. The department's gross sales amounted to $835,380. As the buyer reviewed last years figures for the same period, the customer returns were 10.5%, with gross sales of $726,149. Compute the departments performance in dollars and percentages for this year and last year, with regard to gross sales, customer returns, and net sales. LY % TY Loungeware net sales 89.5% Customer returns 10.5% Loungewear gross sales $726,149.00 100.0% $835,380.00 5.Towel Department Net Sales: The towel department represents 2% of total store sales, which are $3,500,000. What are the net sales planned for the towel department? Total store sales $3,500,000 % to total 2.0% Towel department net sales 6. Shoes/Sneakers Net Sales: Casual sneaker sales represent 4.5% and athletic shoe sales represent 8.2% of total store sales. If total store sales are $960,000, what are the dollar sales for each department? Casual Sneakers Athletic Shoes Total store sales $960,000 $960,000 % to total 4.5% 8.2% Sneakers/shoes net sales Cost of Goods Sold Practice Problems "7.Total Billed Cost: The girls buyer placed an order for the following merchandise: " 150 sweaters with a billed cost of $7.75 each 175 knit tops with a billed cost of $4.50 each 250 leggings with a billed cost of $5.25 each Calculate the total billed cost for this order. # Units Billed cost Total costs Sweaters 150 $7.75 Knit Tops 175 $4.50 Leggings 250 $5.25 Total 8.Total Cost of Merchandise: A gift shop has workroom costs of $575. The billed cost of merchandise sold amounted to $59,000, with cash discounts earned of $1,180 and freight charges of $650. Find the total cost of the merchandise. Billed cost Shipping Workroom costs Total Cost of Merchandise $59,000 $650 $575 Gross Margin Practice Problems 9. Gross Margin: Calculate the gross margin in dollars and percentage for the home department if: Net sales = $149,000 Billed cost of merchandise = $84,250 Cost discount=6.5% Shipping charges = $840 Billed Cost Cost Discount % Cost Discount $ COGS $84,250 6.50% Net sales $149,000 COGS $0 Gross Margin Total Cost and Percentage Operating Expense Practice Problems 10. Total Expenses and Comparison of Sales: Analyze the following information: TY Plan LY Net sales $485,000 $520,000 $450,000 Advertising costs $82,000 $85,000 $86,000 Salaries $94,000 $90,000 $91,000 Find the following: a. What are the total expenses in $ and % for TY, Plan, and LY? TY Plan LY Advertising costs $82,000 $85,000 $86,000 Salaries $94,000 $90,000 $91,000 Total expenses Total net sales $485,000 $520,000 $450,000 Expense % b. What is the comparison (build) of sales for TY versus Plan and TY versus LY? TY Plan LY Net sales $485,000 $520,000 $450,000 Build TY vs. Plan Build TY vs. LY Skeletal Profit and Loss Statements Net sales $1,390,000 Gross margin $574,700 Profit $105,000 $ % Net Sales Problem One $1,390,000 100.0%

For this assignment you will use Excel to calculate a variety of basic merchandising problems using formulas. Specifically, you must complete the following: 1. Review the pertinent formulas from your resources. 2. Read each problem carefully from the Problems tab in the Module Two Merchandising for a Profit Excel document. 3. Complete each problem using formulas.

-COGS =GM $574,700 -Expenses =Profit/Loss $105,000 11.Skeletal Profit and Loss Statement: Set up skeletal profit and loss statement in both dollars and percentage given the information. Gross margin $535,000 Gross margin 25% Expenses $625,000 Net Sales Problem Two $2,140,000 100.0% -COGS =GM $535,000 25.0% -Expenses $625,000 =Profit/Loss