On January 1, 2014, Christel Madan Corporation had inventory of $50,000. At December 31, 2014, Christel Madan

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On January 1, 2014, Christel Madan Corporation had inventory of $50,000. At December 31, 2014, Christel Madan had the following account balances.
Freight-in ................ $ 4,000
Purchases ................ 509,000
Purchase discounts ........... 6,000
Purchase returns and allowances ....... 2,000
Sales revenue ............. 840,000
Sales discounts ............. 5,000
Sales returns and allowances ....... 10,000
At December 31, 2014, Christel Madan determines that its ending inventory is $60,000.

Instructions
(a) Compute Christel Madan’s 2014 gross profit.
(b) Compute Christel Madan’s 2014 operating expenses if net income is $130,000 and there are no nonoperating activities.

Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula                Ending Inventory Formula =...
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Related Book For  answer-question

Accounting Principles

ISBN: 9781118566671

11th Edition

Authors: Jerry Weygandt, Paul Kimmel, Donald Kieso

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