Artisan Inspiration, Inc. is a merchandiser of stone ornaments. The company sold 6 comma 500 units during the year. The company has provided the following information: Sales Revenue $ 577 comma 000 Purchases (excluding Freight In) 300 comma 000 Selling and Administrative Expenses 69 comma 000 Freight In 15 comma 000 Beginning Merchandise Inventory 45 comma 000 Ending Merchandise Inventory 42 comma 000 What is the operating income for the year? (Round your answer to the nearest whole dollar.)

Question

Business

Quinn Horn

29 September, 21:55

Artisan Inspiration, Inc. is a merchandiser of stone ornaments. The company sold 6 comma 500 units during the year. The company has provided the following information: Sales Revenue $ 577 comma 000 Purchases (excluding Freight In) 300 comma 000 Selling and Administrative Expenses 69 comma 000 Freight In 15 comma 000 Beginning Merchandise Inventory 45 comma 000 Ending Merchandise Inventory 42 comma 000 What is the operating income for the year? (Round your answer to the nearest whole dollar.)

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Answers (1)

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Zayden Frank · Answer 1

The operating income for the year is $190,000

Explanation:

The Computation of the operating income is shown below:

= Sales revenue - cost of good sold - Selling and Administrative Expenses

where,

Sales revenue is $577,000

The cost of good sold = Beginning Merchandise Inventory + Purchases (excluding Freight In) + Freight In - Ending Merchandise Inventory

= $45,000 + $300,000 + $15,000 - $42,000

= $318,000

And, the Selling and Administrative Expense is $69,000

Now put these values to the above formula

So, the value would equal to

= $577,000 - $318,000 - $69,000

= $190,000