Multiple-Step Income Statement The Carlsbad Company income statement for the yea
ID: 2584046 • Letter: M
Question
Multiple-Step Income Statement
The Carlsbad Company income statement for the year ended February 28, 20Y8 contains errors:
Prepare a corrected income statement for Carlsbad Company for the year ended February 28, 20Y8.
For the Year Ended February 28, 20Y8
Sales
Cost of goods sold
Gross profit
Expenses:
Selling expenses
Administrative expenses
Delivery expense
Total expenses
Operating income
Other revenue:
Interest revenue
Net income
CARLSBAD COMPANY Income Statement For the Year Ended February 28, 20Y8 Sales $4,220,000 Cost of goods sold (2,650,000) Operating income $1,930,000 Expenses: Selling expenses $ 800,000 Administrative expenses 600,000 Delivery expense 50,000 Total expenses (1,450,000) Other expense: 480,000 Interest revenue 40,000 Gross profit 440,000Explanation / Answer
Carlsbad Company
Corrected income statement:
Carlsbad Company
Income Statement
for the year ended February 28, 20Y8
Sales
$4,220,000
Cost of goods sold
($2,650,000)
Gross profit
$1,570,000
Expenses:
selling expenses
$800,000
Administrative expenses
$600,000
Delivery expense
$50,000
Total expenses
($1,450,000)
Operating income
$120,000
Other Revenue:
Interest revenue
$40,000
Net Income
$160,000
Carlsbad Company
Income Statement
for the year ended February 28, 20Y8
Sales
$4,220,000
Cost of goods sold
($2,650,000)
Gross profit
$1,570,000
Expenses:
selling expenses
$800,000
Administrative expenses
$600,000
Delivery expense
$50,000
Total expenses
($1,450,000)
Operating income
$120,000
Other Revenue:
Interest revenue
$40,000
Net Income
$160,000
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