Part b) Prepare the cost of goods sold section of the income statement. Assume beginning inventory is $900 and ending inventory is $8,611.

Molly's Greenhouse supplies bedding plants and other gardening products to a variety of stores across Alberta and also has a local greenhouse open to the public. Molly's uses a periodic inventory system and the earnings approach for revenue recognition. Transactions for the business are shown below: May 2 Purchased 500 decorative hanging baskets from Planters R Us, on account, at a cost of $30 each, terms 2/10, /30. FOB shipping point. 3 The correct company paid cash for the $175 shipping charges. 4 Sold 200 hanging baskets to a hardware store in the city, on account, for a total involce price of $10,000. Terms are 1/10, 1/30 and the cost was $30 per basket. Molly's paid the shipping charge of $75 on the same day. 5 Received a credit from Planters R Us for the return of 60 hanging baskets that had defective hangers. 20 of the baskets from the sale of May 4 were returned to the greenhouse for a full refund because the customer did not have enough room to store them. 12 Made a payment on account for the balance owing to Planters R Us for the purchase of May 2. 13 Received a cheque for the appropriate amount from the hardware store for the sale of May 4. 7 ent FULL SCREEN PRINTER VERSION 1 BACK NEXT (b) Prepare the cost of goods sold section of the income statement. Assume beginning inventory is $900 and ending inventory is $8,611. MOLLY'S GREENHOUSE Income Statement + $ + Version 4.24.18 FULL SCREEN PRINTER VERSION