Select your language

Suggested languages for you:
Log In Start studying!
Answers without the blur. Just sign up for free and you're in → Illustration


Horngren'S Financial And Managerial Accounting
Found in: Page 893

Short Answer

Question: Calculating income and cost per unit for a merchandising company

Conway Brush Company sells standard hair brushes. The following information summarizes Conway’s operating activities for 2018:

Selling and Administrative Expenses $ 47,058

Purchases 85,800

Net Sales Revenue 151,800

Merchandise Inventory, January 1, 2018 7,920

Merchandise Inventory, December 31, 2018 11,748


1. Calculate the operating income for 2018.

2. Conway sold 6,600 brushes in 2018. Compute the unit cost for one brush.

The net operating income of Conway Brush Company is $22,770 and the unit cost for one brush is $12.42

See the step by step solution

Step by Step Solution

Step-by-Step SolutionStep 1: Calculation of operating income

Income Statement

Amount ($)

Amount ($)

Net Sales Revenue


Less: COGS

Merchandise Inventory, Jan 1, 2018




Less: Merchandise Inventory, Dec 31, 2018



Gross Profit


Selling and administrative expenses


Net Operating Income


Step 2: Computation of unit cost of one brush

Most popular questions for Business-studies Textbooks


Want to see more solutions like these?

Sign up for free to discover our expert answers
Get Started - It’s free

Recommended explanations on Business-studies Textbooks

94% of StudySmarter users get better grades.

Sign up for free
94% of StudySmarter users get better grades.