Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Nicole's Getaway Spa (NGS) has been so successful that Nicole has decided to expand her spa by selling merchandise. She sells things such as nail

Nicole's Getaway Spa (NGS) has been so successful that Nicole has decided to expand her spa by selling merchandise. She sells things such as nail polish, at-home spa kits, cosmetics, and aromatherapy items. Nicole uses a perpetual inventory system and is starting to realize all of the work that is created when inventory is involved in a business. The following transactions were selected from among those completed by NGS in August.

Aug. 2

Sold 10 items of merchandise to Salon World on account at a selling price of $3,500 (total); terms 2/10, n/30. The goods cost NGS $2,275.

Aug. 3

Sold 5 identical items of merchandise to Cosmetics R Us on account at a selling price of $2,000 (total); terms 2/10, n/30. The goods cost NGS $1,600.

Aug. 6

Cosmetics R Us returned one of the items purchased on August 3. The item could still be sold by NGS in the future, and credit was given to the customer.

Aug. 10

Collected payment from Salon World, fully paying off the account balance.

Aug. 20

Sold two at-home spa kits to Meghan Witzel for $800 cash. The goods cost NGS $256.

Aug. 22 Cosmetics R Us paid its remaining account balance in full.
Required:
1.

Prepare journal entries for each transaction.

2-a.

Calculate the amount of Net Sales and Cost of Goods Sold for the transactions listed above.

2-b.

What is Nicole's Getaway Spa's gross profit percentage?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

ACCA Financial Accounting Study Text 2022 23

Authors: Emile Woolf International

1st Edition

1848436831, 978-1848436831

More Books

Students also viewed these Accounting questions

Question

Define "piercing the veil."

Answered: 1 week ago

Question

What is focal length? Explain with a diagram and give an example.

Answered: 1 week ago

Question

What is physics and how does it apply in daily life?

Answered: 1 week ago