Use This Information to Answer the Following Question Goods Available for Sale Would Appear on the Income Statement

question 24

Multiple Choice

Use this information to answer the following question. The selected accounts and balances for Keystone Market appear as follows:
$\begin{array}{lr}\text { Advertising Expense } & 14,000 \\\text { Common Stock } & 100,000 \\\text { Dividends } & 21,000 \\\text { Freight-In } & 7,000 \\\text { Freight-Out Expense } & 10,000 \\\text { Interest Income } & 24,000 \\\text { Merchandise Inventory (Jan. 1) } & 58,000 \\\text { Merchandise Inventory (Dec. 31) } & 56,000 \\\text { Purchases } & 60,000 \\\text { Purchases Returns and Allowances } & 4,000 \\\text { Rent Expense } & 9,000 \\\text { Retained Earnings } & 40,000 \\\text { Sales } & 150,000 \\\text { Sales Returns and Allowances } & 19,000 \\\text { Wages Expense } & 32,000\end{array}$ Goods available for sale would appear on the income statement as

• A) $114,000.
• B) $61,000.
• C) $121,000.
• D) $51,000.

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Definitions:

Business Acquisition

The act of acquiring control over another company either by purchasing its shares, assets, or both, often aiming to expand operations or enter new markets.

Tax Rate

The percentage at which income or profits are taxed by the government.

Income Tax Liability

The amount of tax owed to the government for earnings made during a fiscal period.

Operating Income

The profit earned from a firm's core business operations, excluding deductions of interest and tax.