Hernandez Clothing Store employs the perpetual inventory system and prepares monthly financial statements. All accounts have been
Question:
Hernandez Clothing Store employs the perpetual inventory system and prepares monthly financial statements. All accounts have been adjusted except for merchandise inventory. A physical count of merchandise inventory on November 30, 2014, indicates that $21,000 was on hand. A partial listing of account balances follows:
Accounts Receivable $ 9,000
Merchandise Inventory 23,000
Commissions Expense 600
Sales Returns and Allowances 1,800
Freight Out 1,200
Cost of Goods Sold 31,000
Sales 55,000
Instructions:
a. Prepare a partial income statement for the Hernandez Clothing Store for the month ended November 30, 2014. The income statement should show items through the gross profit category.
b. Calculate Hernandez's gross profit margin for November, 2014.
Intermediate Accounting
ISBN: 978-0077400163
6th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson