Multiple-Step Income Statement and Report Form of Balance Sheet Required: 1. Pre
ID: 2464187 • Letter: M
Question
Multiple-Step Income Statement and Report Form of Balance Sheet
Required:
1. Prepare a multiple-step income statement.
2. Prepare a statement of owner's equity.
3. Prepare a balance sheet, assuming that the current portion of the note payable is $16,000.
4. a. Which type of income statement shows intermediate balances?
SelectMultiple-stepSingle-stepItem 90
b. Which type of balance sheet presents assets, liabilities, and owner's equity in a downward sequence?
SelectAccount formReport form
Income Statement
For the Year Ended August 31, 2014 Revenue from sales: SelectCashMerchandise inventoryPrepaid insuranceSales discountsSalesItem 1 SelectLess: Accounts receivableLess: CashLess: Cost of merchandise soldLess: Gross profitLess: Sales returns and allowancesItem 3 SelectLess: Accounts receivableLess: CashLess: Sales discountsLess: SalesPlus: Sales discountsItem 5 SelectGross profitMia Reynolds, capitalNet incomeNet salesNote payableItem 8 SelectAccounts payableCost of merchandise soldInsurance expenseMerchandise inventoryStore EquipmentItem 10 SelectAccounts payableGross profitIncome from operationsNet incomeNet salesItem 12 Expenses: Selling expenses: SelectCost of merchandise soldNet salesOffice suppliesSales discountsSales salaries expenseItem 14 SelectAccounts payableAdvertising expenseCashDepreciation expense-office equipmentSales returns and allowancesItem 16 SelectAccounts receivableAccumulated depreciation-store equipmentDepreciation expense-store equipmentMia Reynolds, capitalStore equipmentItem 18 SelectCost of merchandise soldMiscellaneous selling expenseOffice equipmentOffice salaries expenseSalesItem 20 Total selling expenses Administrative expenses: SelectMia Reynolds, capitalMerchandise inventoryOffice salaries expenseOffice suppliesSalesItem 23 SelectAccounts receivableAccounts payableNotes payableRent expenseSales returns and allowancesItem 25 SelectAccumulated depreciation-office equipmentCashDepreciation expense-office equipmentOffice equipmentOffice suppliesItem 27 SelectAccounts payableCashInsurance expensePrepaid insuranceSales discountsItem 29 SelectAccounts payableOffice equipmentOffice supplies expenseOffice suppliesSales returns and allowancesItem 31 SelectAccounts receivableInterest expenseMiscellaneous administrative expenseNotes payableSalesItem 33 Total administrative expenses Total operating expenses SelectGross profitIncome from operationsLoss from operationsNet incomeNet lossItem 37 SelectCost of merchandise soldGross profit:Net sales;Other expense:Other income:Item 39 SelectAdvertising expenseMiscellaneous selling expenseInterest expenseOffice supplies expenseSales discountsItem 40 SelectGross profitIncome from operationsLoss from operationsNet incomeNet lossItem 42
Explanation / Answer
Revenue from sales
4,576,000
Less:Sales return
31,000
Sales discounts
28,000
Net sales
$4,517,000
Less:Cost of merchandise sold
2,650,000
Gross profit
1,867,000
Expenses:
Salaries expenses
745,000
Adverstising expenses
205,000
Depreciation – store equipment
40,000
Miscellaneous expense
18,000
Office salaries expense
410,000
Rent expense
60,000
Depreciatione expense – Office Equipment
30,000
Insurance expense
18,000
Office supplies expense
11,000
Misc admisnistrative expense
8,000
Total operating expense
1,545,000
Total operating income
322,000
Other expenses
Interest expense
12,000
Net income
$310,000
Owner’s Equity
Mia Reynold’s capital
675,000
Add:Net income
310,000
Less:Drawing
75,000
Closing balance
910,000
Assets
Liabililties & owners Equity
Cash 125,000
Accounts payable 193,000
Account
Receivable 335,000
Salaries payable
12,000
Inventory 380,000
Total current liabilities
205,000
Office supplies 12,000
Prepaid insurance 9000
Long term liabiltieis
Total current assets
861,000
Notes payable
400,000
Fixed Assets
Owner’s equity
910,000
Office equipment 275,000
Less:Dep -187,000
88,000
Store equipment
859,000
Less : Dep 293,000
566,000
Total Assets
$1,515,000
total
$1,515,000
4) Multi step income statement
5) Report form
Revenue from sales
4,576,000
Less:Sales return
31,000
Sales discounts
28,000
Net sales
$4,517,000
Less:Cost of merchandise sold
2,650,000
Gross profit
1,867,000
Expenses:
Salaries expenses
745,000
Adverstising expenses
205,000
Depreciation – store equipment
40,000
Miscellaneous expense
18,000
Office salaries expense
410,000
Rent expense
60,000
Depreciatione expense – Office Equipment
30,000
Insurance expense
18,000
Office supplies expense
11,000
Misc admisnistrative expense
8,000
Total operating expense
1,545,000
Total operating income
322,000
Other expenses
Interest expense
12,000
Net income
$310,000
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.