Ans 3.

1 (B) and (D) are expenses, others are not

Revenue
Ans 3.2 Expenses
Net income

Ans 3.3
Cost of Goods sold

Gross Margin = Sales Revenue-COGS = 85000-45000 = 40000

% Gross Margin = (Gross Margin/Sales Revenue)*100 = (40000/85000)*100 = 47%
Ans 3.4
% Profit Margin = (Net Profit/Sales)*100 = (9000/85000)*100 = 10.58%
Therefore, other expenses are 36.4% of net revenue generated

a. Depreciation is considered as an associated expense. It'll come as expense in income statement.

b. No
Ans 3.5 c. The associated expense is COGS. It's 7500

d. It'll be an expense for the first year but a prepaid expense, so asset, for second year.

Per month Insurance = 30000/24 = 1250

Expense for 2015 is for 3 months i.e 3*1250 = 3750
For 2016, expense is for 12 months, 12*1250 = 15000
For 2017, cost of insurance is for 9 months, i.e. 9*1250 = 11,250

Ans 3.6
Value of insurance on Dec 2015 = 30000-3750 = 26,250

Value of insurance on Dec 2016 = 26250-3750 = 26,250

Ans 3.6

Value of insurance on Dec 2017 = 0. Here's it gets expired.

QED Electronics Comp

Income Statement
For the Month of Apri
Revenues:-
Service Revenue
Total Revenues:-
Expenses:-
NPA
Ans 3.7 Parts Used
Selling Expense
Wages
Administrative & Miscellaneous Expense
Depreciation
Interest Expense
Utilities
Total Expenses:-
Profit Before tax
Tax
Profit After tax

Current Liabilities, ending balance

Current Ratio

Owners' equity, beginning balance

Inventory, beginning balance

 COGS= Inventory beginning balance+purchase Inventory-Closing balance
COGS= 35000+40000-30000=$45,000

Current liabilities=$50,000
Current ratio=1.6:1
Current Asset=Current ratioxCurrent Liabilities=1.6x50000=$80,000

Owners' Equity =$120,000

Long term Debt= $40,000

Ans 3.8 % Gross Margin= (Total Sales-COGS)/Total sales x100

Total sales= $81,818.2
Gross Margin=Total sales-COGS=$36,812.2
% Profit Margin=(Total sales-Total Expense)/Total Sales x100
Total expense= $8182

ABC Company
Balance sheet
For The End of Period
Current Asset

Other Assets

Total Assets
 275000
246315
28685

= Opening Inventory + Inventory purchased for period + Ending inventory = 27000+78000-31000 = 74000

ncome statement.
ED Electronics Company
Income Statement
For the Month of April

$33,400
$33,400

$645
$3,700
$1,900
$10,000
$4,700
$2,700
$880
$800
$25,325
$8,075
$2,800
$5,275

$50,000 Purchase d$40,000

1.6:1 Inventory, $30,000

$120,000 45%
Gross marg
$35,000 10%
Profit marg

Long term
debt, 40,000
ending
balance
Company
nce sheet
End of Period
$80,000 Current Liab $50,000
Long Term $40,000
$138,182
Total Liabil $90,000
Owners' Eq
Paid in Cap $120,000
Net Profit $8182
Total Owne $128,182

Total
$218,182 Liabilities $218,182
&
Owners'
equity
78000-31000 = 74000