Number 4

QUESTION 4 The following selected accounts and their current balances appear in the ledger of Fernandez Co. at the end of its fiscal year. Cash $250,000 Retained Earnings 2,850,000 Accounts Receivable 1,197,000 Dividends 50,000 Inventory 1,790,000 Sales 9,350,000 Estimated Returns Inventory 23,500 Cost of Goods Sold 3,840,000 Office Supplies 14,000 Sales Salaries Expense 820,000 Prepaid Insurance 8 ,500 Advertising Expense 350,000 Office Equipment 870,000 Depr. Exp.Store Equip. 120,000 Accum. Depr.-Office Equip. 580,000 Miscellaneous Selling Expense 58,000 Store Equipment Salaries Expense $50,000 Accum. Depr. Store Equip. DET 104,000 Accounts Payable -Office Equip 60,000 Customer Refunds Payable 20 39,000 Insurance Expense 50,000 Salaries Payable Supplies Expense 26,000 Notes Payable (long-term) Miscellaneous Admin. Exp. 12,000 Common Stock Interest Expense 25,000 1 sl 19191919191 181 ele What is the amount of gross profit a. $2,162,000 b. $1,335,000 Oc $3,510,000 d. $7,175,000