The following amounts are known: Beginning merchandise inventory $27,000 Ending merchandise inventory 28,000 Purchases 59,000 Purchases returns and allowances 2,500 Purchases discounts 3,100 Freight-in 290 Assume the business makes estimates for sales returns and allowances at year end. The balances for estimated returns inventory are provided below. Beginning estimated returns inventory $2,300 Ending estimated returns inventory 3,200 Required: Prepare the cost of goods sold section of the income statement for Havens Gift Shop.

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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INCOME STATEMENT 

 

 
Havens Gift Shop.
Income Statement (Partial)
For the year ended December 31, 20--
1
Cost of goods sold:
 
 
 
 
2
 
 
 
 
 
3
 
 
 
 
 
4
 
 
 
 
 
5
 
 
 
 
 
6
 
 
 
The following amounts are known:
Beginning merchandise inventory
$27,000
Ending merchandise inventory
28,000
Purchases
59,000
Purchases returns and allowances
2,500
Purchases discounts
3,100
Freight-in
290
Assume the business makes estimates for sales returns and allowances at year end. The balances for estimated returns inventory are provided below.
Beginning estimated returns inventory
$2,300
Ending estimated returns inventory
3,200
Required:
Prepare the cost of goods sold section of the income statement for Havens Gift Shop.
Transcribed Image Text:The following amounts are known: Beginning merchandise inventory $27,000 Ending merchandise inventory 28,000 Purchases 59,000 Purchases returns and allowances 2,500 Purchases discounts 3,100 Freight-in 290 Assume the business makes estimates for sales returns and allowances at year end. The balances for estimated returns inventory are provided below. Beginning estimated returns inventory $2,300 Ending estimated returns inventory 3,200 Required: Prepare the cost of goods sold section of the income statement for Havens Gift Shop.
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