Merchandise Inventory on December 31, 2018 $ 10,500 Merchandise Inventory on January 1, 2018 16,000 Net Sales Revenue 56,000 Utilities Expense for the shop 3,200 Rent for the shop 4,100 Sales...

Preparing an income statement and calculating unit cost for a merchandising company

Dillon Young owns Dillon’s Pets, a small retail shop selling pet supplies. On December 31, 2018, the accounting records for Dillon’s Pets showed the following:

Requirements

1. Prepare an income statement for Dillon’s Pets for the year ended December 31, 2018.


2. Dillon’s Pets sold 5,550 units. Determine the unit cost of the merchandise sold, rounded to the nearest cent.

Extracted text: Merchandise Inventory on December 31, 2018 $ 10,500 Merchandise Inventory on January 1, 2018 16,000 Net Sales Revenue 56,000 Utilities Expense for the shop 3,200 Rent for the shop 4,100 Sales Commissions 2,750 Purchases of Merchandise Inventory 25,000