Marketing and advertising costs

$54,000

Merchandise inventory, January 1, 2017

92,000

Shipping of merchandise to customers

2,000

Depreciation on Store Fixtures

9,000

Purchases

523,000

General and administrative costs

70,000

Merchandise inventory, December 31, 2017

109,000

Merchandise freight-in

22,000

Purchase returns and allowances

20,000

Purchase discounts

20,000

Revenues

630,000

The following data are for

MeedMeed

Retail Outlet Stores. The account balances (in thousands) are for

20172017.

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Requirements

1.

Compute (a) the cost of goods purchased and (b) the cost of goods sold.

2.

Prepare the income statement for
20172017.

Requirement 1. Compute (a) the cost of goods purchased and (b) the cost of goods sold.

(a) Begin by completing the schedule of cost of goods purchased.

Meed Retail Outlet Stores

Schedule of Cost of Goods Purchased

For the Year Ended December 31, 2017 (in thousands)

Purchases

Add:

Deduct:

Cost of goods purchased