Chapter 18, Problem S18.7SE

Computing cost of goods sold and operating income, merchandising company
Learning Objective 3
Consider the following partially completed income statements for merchandising companies and compute the missing amounts:

	Smith, Inc.	Allen, Inc.
Net Sales Revenue	$ 101,000	$ (d)
Cost of Goods Sold:
Beginning Merchandise Inventory	(a)	29,000
Purchases and Freight In	50,000	(e)
Cost of Goods Available for Sale	(b)	89,000
Ending Merchandise Inventory	(2,200)	(2,200)
Cost of Goods Sold	61,000	(f)
Gross Profit	40,000	114,000
Selling and Administrative Expenses	(c)	84,000
Operating Income	$ 12,000	$ (g)