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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.

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.

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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Subject: acounting 

Exercise 3-14A (Algo) Comparing gross margin and gain on sale of land LO 3-6 Lopez Sales Company had the following balances in its accounts on January 1, Year 2: Cash Merchandise Inventory Land: Common Stock Retained Earnings $ 55,000 35,000 95,000 75,000 110,000 Lopez experienced the following events during Year 2: 1. Sold merchandise inventory that cost $28,000 for $59,500. 2. Sold land that cost $38,000 for $71,300. a. Gross margin b. Gain on sale of land 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.
Transcribed Image Text:Exercise 3-14A (Algo) Comparing gross margin and gain on sale of land LO 3-6 Lopez Sales Company had the following balances in its accounts on January 1, Year 2: Cash Merchandise Inventory Land: Common Stock Retained Earnings $ 55,000 35,000 95,000 75,000 110,000 Lopez experienced the following events during Year 2: 1. Sold merchandise inventory that cost $28,000 for $59,500. 2. Sold land that cost $38,000 for $71,300. a. Gross margin b. Gain on sale of land 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.
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