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Lopez Sales Company had the following balances in its accounts on January 1, Year 2: $42.000

Lopez Sales Company had the following balances in its accounts on January 1, Year 2: $42.000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Lopez Sales Company had the following balances in its accounts on January 1, Year 2: Cash Merchandise Inventory Land Common Stock Retained Earnings $42,000 36,000 50,000 70,000 58,000 Lopez experienced the following events during Year 2: 1. Sold merchandise inventory that cost $22,000 for $40,500. 2. Sold land that cost $30,000 for $46,000. Required a. Determine the amount of gross margin recognized by Lopez. b. Determine the amount of the gain on the sale of land recognized by Lopez. a. Gross margin b. Gain on sale of land
Transcribed Image Text:Lopez Sales Company had the following balances in its accounts on January 1, Year 2: Cash Merchandise Inventory Land Common Stock Retained Earnings $42,000 36,000 50,000 70,000 58,000 Lopez experienced the following events during Year 2: 1. Sold merchandise inventory that cost $22,000 for $40,500. 2. Sold land that cost $30,000 for $46,000. Required a. Determine the amount of gross margin recognized by Lopez. b. Determine the amount of the gain on the sale of land recognized by Lopez. a. Gross margin b. Gain on sale of land
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