At the end of Donaldson Department Store’s fiscal year on November 30, 2017, these accounts appeared in its adjusted trial balance.

Freight-In ………………………………….………… $       7,500

Inventory ………………………………….…………        40,000

Purchases ………………………………….…………     585,000

Purchase Discounts ……………………………..         6,300

Purchase Returns and Allowances ………..        2,700

Sales Revenue ……………………………………… 1,000,000

Sales Returns and Allowances …………...…       20,000

Additional facts:

1. Merchandise inventory on November 30, 2017, is $52,600.

2. Donaldson Department Store uses a periodic system.

Instructions

Prepare an income statement through gross profit for the year ended November 30, 2017.