Find the entry you would make on an income statement for TOTAL OPERATING EXPENSES for the year ended December 31, 2007: Gross Sales, $161,000; Sales Returns and Allowances, $9,600; Sales Discounts, $11,600; Merchandise Inventory, January 1, 2011, $52,500; Merchandise Inventory, December 31, 2011, $62,500; Net Purchases, $82,300; Freight In, $3,000; Salaries, $94,700; Rent, $29,800; Utilities, $2,245; Insurance, $3,250; and Income Tax, $19,600.
A) $129,995
B) $102,875
C) $127,750
D) $149,595

Question

Quizplus · Accepted Answer

Total Operating Expenses = Sales Returns and Allowances + Sales Discounts + Cost of Goods Sold + Salaries + Rent + Utilities + Insurance= $9,600 + $11,600 + ($82,300 + $3,000 - $52,500 + $62,500) + $94,700 + $29,800 + $2,245 + $3,250= $129,995

Find the Entry You Would Make on an Income Statement