Answer full question. Answer a,b and c ### Example Multistep Income Statement and Net Income Analysis---#### Instruction B**Assume that normal operating activities grow evenly by 29% during Year 2. Prepare a Year 2 multistep income statement for Kim Company.****KIM COMPANY** **Income Statement** **For the year ended December 31, Year 2** | **Description** | **Amount** ||-----------------------|----------------|| | || | || | || **Expenses** | || | || **Non-Operating Items** | || | |---#### Instruction C**Determine the percentage change in net income between Year 1 and Year 2. (Round your answer to one decimal place.)****Net income** **by** **%**---### Explanation of the Diagram StructureThe diagram provided in the image is a template for preparing a multistep income statement for Kim Company for the year ended December 31, Year 2. The structure generally includes several key components:1. **Header**: The header clearly states the company's name (Kim Company), the title of the document (Income Statement), and the period covered (For the year ended December 31, Year 2).2. **Sections**: The template is divided into blank rows where various items are to be listed. This includes lines for: - Sales or revenues - Cost of goods sold - Gross profit (implicit from the above two rows) - Operating expenses - Operating income - Non-operating items - Net income3. **Expenses**: A dedicated section for listing out expenses, which typically leads to the calculation of the total expenses.4. **Non-Operating Items**: This section is reserved for items not related to the core operating activities of the company, such as interest or gains/losses from investments.5. **Percentage Change Calculation**: An additional task requires determining the percentage change in net income between Year 1 and Year 2.The empty cells indicate where the relevant financial figures will be filled in based on the given 29% growth assumption. The subsequent part requests to calculate the percentage change in net income, which involves comparing the net income figures from Year 1 and Year 2 and expressing the change as a percentage.This guide allows students to practice creating an ### Kim Company Year 1 Income Statement#### OverviewIn Year 1, Kim Company conducted the following financial activities:1. Sold land for $96,000 cash, originally purchased at $52,000.2. Sold inventory costing $184,000 for $287,000 cash.3. Incurred operating expenses amounting to $52,000.#### Requireda. Prepare a Year 1 multistep income statement for Kim Company.### Multistep Income Statement for Kim Company**Income Statement for the year ended December 31, Year 1**| **Description** | **Amount ($)** ||------------------------|----------------|| **Revenues** | || Sales Revenue | 287,000 || Cost of Goods Sold | (184,000) || **Gross Profit** | **103,000** || | || **Operating Expenses** | || Operating Expenses | (52,000) || **Operating Income** | **51,000** || | || **Non-Operating Items**| || Gain on Sale of Land | 44,000 || **Net Income** | **95,000** |#### Explanation:1. **Revenues**: Kim Company earned a total of $287,000 from sales. 2. **Cost of Goods Sold (COGS)**: The cost attributed to the inventory sold was $184,000. - **Gross Profit**: This results in a Gross Profit of $103,000 (Revenue - COGS).3. **Operating Expenses**: The company incurred operating expenses amounting to $52,000. - **Operating Income**: Subtracting operating expenses from gross profit results in an Operating Income of $51,000.4. **Non-Operating Items**: - **Gain on Sale of Land**: The land was sold for $96,000 against its purchase price of $52,000, resulting in a gain of $44,000.5. **Net Income**: Summing Operating Income and Gain on Sale of Land gives a Net Income of $95,000 for the year.This structure and breakdown provide a clear view of Kim Company's financial performance for Year 1.

In Year 1, Kim Company sold land for $96,000 cash. The land had originally cost $52,000. Also, Kim sold inventory that had cost $184,000 for $287,000 cash. Operating expenses amounted to $52,00O. Required a. Prepare a Year 1 multistep income statement for Kim Company. KIM COMPANY Income Statement For the year ended December 31, Year 1 Expenses Non-Operating Items