Les Fleurs, a boutique in Paris, France, had the following accounts in its accounting records at December 31, 20X2 (amounts in Euros, denoted as "E")
Purchases………………...
E250,000 Freight In……………… E8,000
Sales discounts…………. 4,000 Purchase returns…….. 7,000
Inventory Sales…………………. 400,000
December 31, 20X1….. 20,000 Purchase discounts…. 3,000
December 31, 20X2….. 30,000 Sales returns…………. 8,000
Compute the following for Les Fleurs during 20X2: (Do not convert the figures to US dollars.)
Net sales revenue
Cost of goods sold
Gross profit
To compute the net sales revenue, cost of goods sold, and gross profit for Les Fleurs during 20X2, we need to use the given information regarding purchases, freight in, sales discounts, purchase returns, inventory, sales, purchase discounts, and sales returns.
1. Net Sales Revenue:
Net Sales Revenue = Sales - Sales Returns - Sales Discounts
Net Sales Revenue = 400,000 - 8,000 - 4,000
Net Sales Revenue = 388,000 Euros
2. Cost of Goods Sold:
Cost of Goods Sold = Opening Inventory + Purchases + Freight In - Purchase Returns - Purchase Discounts - Closing Inventory
Cost of Goods Sold = 20,000 + 250,000 + 8,000 - 7,000 - 3,000 - 30,000
Cost of Goods Sold = 238,000 Euros
3. Gross Profit:
Gross Profit = Net Sales Revenue - Cost of Goods Sold
Gross Profit = 388,000 - 238,000
Gross Profit = 150,000 Euros
So, the net sales revenue for Les Fleurs during 20X2 is 388,000 Euros, the cost of goods sold is 238,000 Euros, and the gross profit is 150,000 Euros.