“Consider the following partially completed income statements for merchandising companies and compute the missing amounts:Rustic GearFind: A. Beginning Merchandise Inventory, B. Cost of Goods Available for Sale, and C. Selling and Admin ExpensesFind: A. Sales, B. Purchases and Freight In, C. Cost of Goods Sold, D. Operating Income”
Rustic Gear:A. Beginning Merchandise Inventory = Cost of Goods Available for Sale – Purchases and Freight InB. Cost of Goods Available for Sale = Cost of Goods Sold + Ending Merchandise InventoryC. Selling and Admin Costs = Gross Profit – Operating IncomeCorrigan Inc.:A. Sales = Gross Profit + Cost of Goods SoldB. Purchases and Freight In = Cost of Goods Sold – Beginning InventoryC. Cost of Goods Sold = Cost of Goods Available for Sale – Ending Merchandise InventoryD. Operating Income = Gross Profit – Selling and Admin Costs