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Instructions Accounts, Labels and Amount Descriptions Select information below is taken from the December 31, 2020 adjusted trial balance of Accounts Rummer Company: Freight-in Freight-in $7,500 General and administrative expenses General and administrative expenses 50,000 Inventory, 1/1/20 Interest expense 15,000 Inventory, 12/31/20 Inventory 165,000 Interest expense Loss on sale of a major component of the business (pretax) 15,000 Income tax expense Purchases 330,000 Loss on sale of business component Purchases returns 5,000 Purchases Sales 700,000 Purchases returns Sales discounts 10,000 Sales Selling expenses 25,000 Sales discounts Selling expenses The inventory on January 1 was $140,000. The income tax rate is 30%. There were 25,000 Labels shares of common stock outstanding throughout the year. Expenses Operating expenses Required: Other items a. Prepare a schedule of the cost of goods sold. Amount Descriptions b. Prepare a 2020 income statement for Rummer Company, using a multiple-step Cost of purchases format (disregard earnings per share). Cost of goods available for sale c. Prepare a 2020 income statement for Rummer Company, using a single-step Cost of goods sold format (disregard earnings per share). Gross profit

Instructions Accounts, Labels and Amount Descriptions Select information below is taken from the December 31, 2020 adjusted trial balance of Accounts Rummer Company: Freight-in Freight-in $7,500 General and administrative expenses General and administrative expenses 50,000 Inventory, 1/1/20 Interest expense 15,000 Inventory, 12/31/20 Inventory 165,000 Interest expense Loss on sale of a major component of the business (pretax) 15,000 Income tax expense Purchases 330,000 Loss on sale of business component Purchases returns 5,000 Purchases Sales 700,000 Purchases returns Sales discounts 10,000 Sales Selling expenses 25,000 Sales discounts Selling expenses The inventory on January 1 was $140,000. The income tax rate is 30%. There were 25,000 Labels shares of common stock outstanding throughout the year. Expenses Operating expenses Required: Other items a. Prepare a schedule of the cost of goods sold. Amount Descriptions b. Prepare a 2020 income statement for Rummer Company, using a multiple-step Cost of purchases format (disregard earnings per share). Cost of goods available for sale c. Prepare a 2020 income statement for Rummer Company, using a single-step Cost of goods sold format (disregard earnings per share). Gross profit

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter5: The Income Statement And The Statement Of Cash Flows
Section: Chapter Questions
Problem 8E: Cost of Goods Sold, Income Statement. and Statement of Comprehensive Income Gaskin Company derives...
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Instructions Accounts, Labels and Amount Descriptions Select information below is taken from the December 31, 2020 adjusted trial balance of Accounts Rummer Company: Freight-in Freight-in $7,500 General and administrative expenses General and administrative expenses 50,000 Inventory, 1/1/20 Interest expense 15,000 Inventory, 12/31/20 Inventory 165,000 Interest expense Loss on sale of a major component of the business (pretax) 15,000 Income tax expense Purchases 330,000 Loss on sale of business component Purchases returns 5,000 Purchases Sales 700,000 Purchases returns Sales discounts 10,000 Sales Selling expenses 25,000 Sales discounts Selling expenses The inventory on January 1 was $140,000. The income tax rate is 30%. There were 25,000 Labels shares of common stock outstanding throughout the year. Expenses Operating expenses Required: Other items a. Prepare a schedule of the cost of goods sold. Amount Descriptions b. Prepare a 2020 income statement for Rummer Company, using a multiple-step Cost of purchases format (disregard earnings per share). Cost of goods available for sale c. Prepare a 2020 income statement for Rummer Company, using a single-step Cost of goods sold format (disregard earnings per share). Gross profit
Transcribed Image Text:Instructions Accounts, Labels and Amount Descriptions Select information below is taken from the December 31, 2020 adjusted trial balance of Accounts Rummer Company: Freight-in Freight-in $7,500 General and administrative expenses General and administrative expenses 50,000 Inventory, 1/1/20 Interest expense 15,000 Inventory, 12/31/20 Inventory 165,000 Interest expense Loss on sale of a major component of the business (pretax) 15,000 Income tax expense Purchases 330,000 Loss on sale of business component Purchases returns 5,000 Purchases Sales 700,000 Purchases returns Sales discounts 10,000 Sales Selling expenses 25,000 Sales discounts Selling expenses The inventory on January 1 was $140,000. The income tax rate is 30%. There were 25,000 Labels shares of common stock outstanding throughout the year. Expenses Operating expenses Required: Other items a. Prepare a schedule of the cost of goods sold. Amount Descriptions b. Prepare a 2020 income statement for Rummer Company, using a multiple-step Cost of purchases format (disregard earnings per share). Cost of goods available for sale c. Prepare a 2020 income statement for Rummer Company, using a single-step Cost of goods sold format (disregard earnings per share). Gross profit
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