QS 4-3 Merchandise accounts and computations LO C2

Kleiner Merchandising Company

Accumulated depreciation$700

Beginning inventory5,000

Ending Inventory1,700

Expenses1,450

Net Purchases3,900

Net Sales9,500

Krug Service Company

Expenses$12,500

Revenues14,000

Cash700

Prepaid rent800

Accounts payable200

Equipment1,300

Required:

a.Compute gross profit, the goods available for sale, and the cost of goods sold for the merchandiser.Hint: Not all information may be necessary.

b.Use the above information from a service company and from a merchandiser to compute net income.

a. Goods available for sale ($_______)

Cost of goods sold ($_______)

Gross profit ($_______)

b. Net income for Krug Service Company ($_______)

Net income for Kleiner Merchandising Company ($_______)