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Problem 1: Blue Company on July 15 sells merchandise on account to Cherry Co. for OMR 1,000, terms 2/10, n/30. On July 20, Cherry Co. returns merchandise worth OMR 300 to Blue Company. On July 24, payment is received from Cherry Co. for the balance due. What is the amount of cash received?
a) OMR 700.
b) OMR 680.
c) OMR 686
d) None of the above.
Problem 2: A single-step income statement:
a) reports gross profit.
b) does not report cost of goods sold.
c) reports sales revenues and "Other revenues and gains" in the revenues section of the income statement
d) reports operating income separately.
Financial Statement Analysis and Preparation
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T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .
Computation of Free Cash Flow
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