Problem 6.2A (Static) Preparation and Interpretation of a Merchandising Company's Income Statement (LO6-1, LO6-2, LO6-3, LO6-6, LO6-8) Hendry's Boutique is a retail clothing store for women. The store operates out of a rented building in Storm Lake, Iowa. The following is the store's adjusted year-end trial balance dated December 31, current year. $ 18,240 3,120 21,000 2,160 1,080 49,200 $ HENDRY'S BOUTIQUE Adjusted Trial Balance December 31, current year Cash Accounts receivable Merchandise inventory Prepaid rent Office supplies Office equipment Accumulated depreciation: office equipment Accounts payable Sales taxes payable Capital stock Retained earnings Sales Sales returns and allowances Cost of goods sold Purchase discounts lost Utilities expense Office supply expense Depreciation expense: office equipment Rent expense Insurance expense Salaries expense Income taxes expense 14,400 15,300 3,840 21,600 25,260 271,200 3,000 120,690 300 4,944 624 3,300 7,320 1,080 105,714 9,828 $ 351,600 $ 351,600 Required: a. Prepare an income statement for Hendry's Boutique dated December 31, current year. HENDRY'S BOUTIQUE Income Statement For the Year Ended December 31, Current Year Other expenses b. Compute the store's gross protit margin as a percentage of net sales. Gross profit margin % c. Do the store's customers seem to be satisfied with their purchases? O Yes f. Which accounts appearing in the store's adjusted trial balance comprise its operating cycle? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) ? Cash ? Accounts receivable ? Merchandise inventory ? Prepaid rent 2 Office supplies