The Following Data Relate to Gorr Company for the Year

question 56

Multiple Choice

The following data relate to Gorr Company for the year ended December 31, 2010.Gorr Company uses the accrual basis.
Sales for cash
$200,000
Sales for credit
220,000
Cost of inventory sold
180,000
Collections from customers
300,000
Purchases of inventory on credit
190,000
Payment for purchases
180,000
Selling expenses (accrual basis)
50,000
Payment for selling expenses
60,000
Which of the following represents income for Gorr Company for the year ended December 31, 2010?

• A) $180,000
• B) $185,000
• C) $190,000
• D) $200,000
• E) none of the answers are correct

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Definitions:

Federal Trade Commission

A U.S. federal agency established to enforce laws related to consumer protection and competition between businesses.

Federal Communications Commission

A United States government agency responsible for regulating interstate and international communications via radio, television, wire, satellite, and cable.

Geographical Pricing

A pricing strategy where the price of a product or service varies depending on the geographical location or market.

FOB Freight-Allowed

A shipping term indicating that the seller pays for the transportation of goods to a specific location, but the buyer assumes the risk of loss once shipped.