# ACCOUNTING

roblem 5-3A Part 4

 4 Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31, 2011. (Round your answers to 2 decimal places.)

 Current ratio [removed] Acid-test ratio [removed] Gross margin ratio [removed]

Problem 5-4A Computing merchandising amounts and formatting income statements L.O. C2, P4

[The following information applies to the questions displayed below.]

 BizKid Company’s adjusted trial balance on August 31, 2011, its fiscal year-end, follows.

 Debit Credit Merchandise inventory \$ 31,000 Other (noninventory) assets 120,400 Total liabilities \$ 35,000 N. Kidman, Capital 101,650 N. Kidman, Withdrawals 8,000 Sales 212,000 Sales discounts 3,250 Sales returns and allowances 14,000 Cost of goods sold 82,600 Sales salaries expense 29,000 Rent expense—Selling space 10,000 Store supplies expense 2,500 Advertising expense 18,000 Office salaries expense 26,500 Rent expense—Office space 2,600 Office supplies expense 800 Totals \$ 348,650 \$ 348,650

 On August 31, 2010, merchandise inventory was \$25,000. Supplementary records of merchandising activities for the year ended August 31, 2011, reveal the following itemized costs.

 Invoice cost of merchandise purchases \$ 91,000 Purchase discounts received 1,900 Purchase returns and allowances 4,400 Costs of transportation-in 3,900

Problem 5-4A Part 1

 Required: 1. Compute the company’s net sales for the year. (Omit the “\$” sign in your response.)

 Net sales \$ [removed]

Problem 5-4A Part 2

 2 Compute the company’s total cost of merchandise purchased for the year. (Omit the “\$” sign in your response.)

 Total cost of merchandise purchased \$ [removed]

Problem 5-4A Part 3

 3 Prepare a multiple-step income statement that includes separate categories for selling expenses and for general and administrative expenses. (Input all amounts as positive values. Omit the “\$” sign in your response.)

 BIZKID COMPANY Income Statement For Year Ended August 31, 2011 \$ [removed] \$ [removed] [removed] [removed] [removed] [removed] [removed] Expenses Selling expenses [removed] [removed] [removed] [removed] Total selling expenses [removed] General and administrative expenses [removed] [removed] [removed] Total general and administrative expenses [removed] Total expenses [removed] \$ [removed]

Problem 5-4A Part 4

 4 Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses. (Input all amounts as positive values. Omit the “\$” sign in your response.)

 BIZKID COMPANY Income Statement For Year Ended August 31, 2011 \$ [removed] Expenses \$ [removed] [removed] [removed] Total expenses [removed] \$ [removed]

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