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Hair Care Inc. is a wholesaler of hair supplies. Hair Care uses a perpetual inventory system. The following transactions (summarized) have been selected for analysis: a. Sold merchandise for cash (cost of merchandise $29,197) $ 51,600 b. Received merchandise returned by customers as unsatisfactory (but in perfect condition), for cash refund (original cost of merchandise $400) 640 10,000 c. Sold merchandise (costing $4,950) to a customer, on account with terms 3/10, n/30 d. Collected half of the balance owed by the customer in (c) within the discount period Granted an allowance to the customer in (c) 4,850 180 Required: 1. Compute Sales Revenue, Net Sales, and Gross Profit for Hair World. Sales revenue Net sales Gross profit 2. Compute the gross profit percentage. (Round your answer to the nearest whole percent.) Gross profit percentage
3. Prepare journal entries to record transactions (a)-(e). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list View journal entry worksheet No General Journal Debit Credit Transaction Ⓒ
4. Hair Care is considering a contract to sell merchandise to a hair salon chain for $15,400. This merchandise will cost Hair Care $10,000. (a) Compute the new gross profit percentage. (Round your answer to the nearest whole percent.) New gross profit percentage % (b) Would this contract increase or decrease Hair Care's gross profit percentage? Decrease Increase
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