Perry Corporation is a local grocery store organized seven years ago as a corporation. At that time, 10,000 common shares were issued to the three organizers. The store is in an excellent location, and sales have increased each year. At the end of 2015, the bookkeeper prepared the following statement (assume that all amounts are correct; note the incorrect terminology and format):
1. Beginning with net sales, prepare a multiple- step statement of earnings (showing both gross profit and earnings from operations). Treat sales discounts as a contra- revenue account
2. The beginning and ending balances of trade receivables were $ 16,000 and $ 18,000, respectively. Compute the gross profit percentage and receivables turnover ratio and explain their meaning.

  • CreatedAugust 04, 2015
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