The Gross Profit

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  1. In the month of January a car dealership bought its vehicles for $100,000 and sold them for $145,000. It pays its employees $20,000 for the month.  What is the gross profit for January?
  2. $45,000
  3. $25,000
  4. $100,000
  5. $145,000

 

  1. An investment company purchased land June 1, 2019 for $100,000. At the end

2020, the land is sold for $220,000. It incurred operating expenses of $80,000. What is the net income recorded for the year ended December 31, 2020?

  1. $220,000
  2. $100,000
  3. $120,000
  4. $40,000

 

  1. Bella Inc. purchased $12,500 worth of merchandise on June 1, 2019 on credit. After inspecting the inventory it determined that 20% of the items were defective. It returned these goods to the supplier. Assume a perpetual inventory system is used, a physical count verifies the amount of goods, and no other transactions take place, what is balance reported as inventory on the balance sheet?
  2. $12,500
  3. $10,000
  4. $2,500
  5. $15,000

 

  1. Beanie Inc. purchases on credit and receives $8,500 worth of merchandise on June 1, 2019. After inspecting the inventory, management determines that 10% of the items are defective. These are returned to the supplier. The terms with the supplier are 2/10, n30.  If Beanie pays the invoice on June 15, what is the amount paid?
    1. $7,497
    2. $7,650
    3. $8,330
    4. $6,885

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