QUESTION 4 Not complete Points out of 4.00 PFlag question Inferring Transactions
ID: 2585494 • Letter: Q
Question
QUESTION 4 Not complete Points out of 4.00 PFlag question Inferring Transactions from Financial Statements The GAP is a global clothing retailer for men, women, children, and babies. The following information is taken from The Gap's fiscal 2015 annual report. Selected Balance Sheet Data ($ millions) Inventories Accounts Payable 2015 $1,939 $1,823 1,178 1,107 2014 a. The Gap purchased inventories totaling $10,550 million during fiscal 2015. Use the financial statement effects template to record cost of goods sold for The Gap's fiscal year ended 2015. (Assume accounts payable is used only for recording purchases of inventories and all inventories are purchased on credit.) b. What amount did the company pay to suppliers during the year? Record this with the financial statement effects template Use negative signs with answers, if appropriate Balance Sheet Income Statement Noncash Contrib Earned Transaction Cash Asset + Liabilities Revenues Exp penses Net income Assets Capital Capital a. Recognize cost of goods sold. b. Cash paid to suppliers.Explanation / Answer
Answer =A) CALCULATION OF COST OF GOODS SOLD Cost of Goods Sold =Opening Inventory + Purchases - Closing Stock Cost of Goods Sold = Openining inventory = $ 1,823 Add: Purcahses $ 10,550 Less: Closing inventory $ 1,939 Cost of Goods Sold = $ 10,434 Answer =B) Calculation of amount payable in the year Amount payable tpo Supplies = Opening Account payable + Purchases - Closing Account Payable Amount payable tpo Supplies = Opening Account payable = 1107 Add: Purchases $ 10,550 Less: Closing Account payable 1178 Amount paid = $ 10,479 INCOMESTATMENT RECORD WITH THIS IN THE FINANCIAL STATEMENT Transaction Cash Assets + Non- Cash Assets = Liability + Contributed Capital + Earned Capital Revenues - Expenses = Net Income a) Recognize the cost of Goods Sold $ 10,434 b) Cash Paid to Supplies -10479