What should the sales revenue be for Yummy Treats?

Steps to Solve

1. Identify Sales Revenue from the Income Statement

   Look at the income statement provided. The sales revenue figure is given as $100,000.

2. Calculate Cost of Goods Sold (COGS)

   COGS can be calculated using the following formula:

   $$ \text{COGS} = \text{Beginning Finished Goods Inventory} + \text{Cost of Goods Manufactured} - \text{Ending Finished Goods Inventory} $$

   Substitute the values from the income statement:

   • Beginning Finished Goods Inventory = $0
   • Cost of Goods Manufactured = $75,400
   • Ending Finished Goods Inventory = $10,000

   So,

   $$ \text{COGS} = 0 + 75,400 - 10,000 = 65,400 $$

3. Complete the Income Statement

   Use the calculated COGS to find the Gross Profit:

   $$ \text{Gross Profit} = \text{Sales Revenue} - \text{COGS} $$

   Substitute the values:

   • Sales Revenue = $100,000
   • COGS = $65,400

   So,

   $$ \text{Gross Profit} = 100,000 - 65,400 = 34,600 $$

4. Final Review of Income Statement

   Ensure all values are correctly filled in. The final sales revenue remains correctly stated as $100,000 after the calculations.