Exercise 228 (Part Level Submision) (a) Exercise 228 (Part Level Submision) The
ID: 2475268 • Letter: E
Question
Exercise 228 (Part Level Submision)
(a)
Exercise 228 (Part Level Submision)
The adjusted trial balance of McCoy Company included the following selected accounts: Debit Credit Sales Revenue $645,000 Sales Returns and Allowances $50,000 Sales Discounts 9,500 Cost of Goods Sold 396,000 Freight-Out 2,000 Advertising Expense 15,000 Interest Expense 19,000 Salaries and Wages Expense 84,000 Utilities Expense 23,000 Depreciation Expense 3,500 Interest Revenue 25,000(a)
Use the above information to prepare a multiple-step income statement for the year ended December 31, 2014. (List other revenues before other expenses.)
Explanation / Answer
McCoy Company
Income Statment
For the year ended December 31, 2014
Sales .............................................................................. $645,000
Less: Sales Return & Allowances ...................................... $ 50,000
Sales Discount ....................................................... $ 9,500 $ 59,500
Net Sales ...................................................................... $ 585,500
Cost of Goods Sold ......................................................... $ 396,000
Gross Profit ................................................................... $ 189,500
Operating Expenses
Salaries & Wages Expenses................................ $ 84,000
Utilities Expenses ............................................ $ 23,000
Advertising Expenses ...................................... $ 15,000
Depreciation Expenses ..................................... $ 3,500
Freight Out ...................................................... $ 2,000
Total Operating Expenses .................... $ 127,500
Income from Operations ................................................... $ 62,000
Other Revenues & Gains
Interest Revenue .......................................... $ 25,000
Other Expenses & Losses
Interest Expense ........................................... $ 19,000 $ 6,000
Net Income .................................................................... $ 68,000
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.