Skip to main content

Business Accounting Loose Leaf for Financial Accounting: Information for Decisions

a. Introduction : Multi step income statement computes the company’s revenues, expenses and profit or loss for a given period. It is more detailed and an elaborative version of single step income statement. To determine : The tax effects and after tax amounts of the items labelled as pre tax. The after tax amount of Loss from operating a discontinued segment is $90,000. The after tax amount of Loss on discontinued segment’s assets is $135,000. The correction of previous year’s expense has already been adjusted. Multi step income statement Particulars Amount (in $) Amount (in $) Sales 2,640,000 Less: cost of goods sold (1,040,000) Gross profit: 1,600,000 Operating expenses: Depreciation on building 400,000 Depreciation on equipment 220,000 Other operating expenses 328,000 Loss on sale of equipment 24,000 Total operating expense (972,000) Operating income: 628,000 Loss from settlement of lawsuit (36,000) Gain from settlement of lawsuit 68,000 Interest income 20,000 52,000 Income before taxes from continuing operations 680,000 Less: income tax (170,000) Income from continuing operations 510,000 Discontinued operations: Loss from operating a discontinued segment (net) (90,000) Loss on sale of discontinued operations assets (net) (135,000) Income from extraordinary items (225,000) Loss on hurricane damage (48,000) Net income 237,0000 b. Introduction : Multi step income statement computes the company’s revenues, expenses and profit or loss for a given period. It is more detailed and an elaborative version of single step income statement. To determine : The income from continuing operations before tax, income tax expenses and the loss from continuing operations. Income from continuing operations before tax is $680,000. Income tax expenses are $170,000. Income from continuing operations are $510,000. Multi step income statement Particulars Amount (in $) Amount (in $) Sales 2,640,000 Less: cost of goods sold (1,040,000) Gross profit: 1,600,000 Operating expenses: Depreciation on building 400,000 Depreciation on equipment 220,000 Other operating expenses 328,000 Loss on sale of equipment 24,000 Total operating expense (972,000) Operating income: 628,000 Loss from settlement of lawsuit (36,000) Gain from settlement of lawsuit 68,000 Interest income 20,000 52,000 Income before taxes from continuing operations 680,000 Less: income tax (170,000) Income from continuing operations 510,000 Discontinued operations: Loss from operating a discontinued segment (net) (90,000) Loss on sale of discontinued operations assets (net) (135,000) Income from extraordinary items (225,000) Loss on hurricane damage (48,000) Net income 237,0000 c. Introduction : Multi step income statement computes the company’s revenues, expenses and profit or loss for a given period. It is more detailed and an elaborative version of single step income statement. To determine : The total amount of after tax income associated with discontinued segment. The total amount of after tax income(loss) associated with discontinued segment is $225,000. Multi step income statement Particulars Amount (in $) Amount (in $) Sales 2,640,000 Less: cost of goods sold (1,040,000) Gross profit: 1,600,000 Operating expenses: Depreciation on building 400,000 Depreciation on equipment 220,000 Other operating expenses 328,000 Loss on sale of equipment 24,000 Total operating expense (972,000) Operating income: 628,000 Loss from settlement of lawsuit (36,000) Gain from settlement of lawsuit 68,000 Interest income 20,000 52,000 Income before taxes from continuing operations 680,000 Less: income tax (170,000) Income from continuing operations 510,000 Discontinued operations: Loss from operating a discontinued segment (net) (90,000) Loss on sale of discontinued operations assets (net) (135,000) Income from extraordinary items (225,000) Loss on hurricane damage (48,000) Net income 237,0000 d. Introduction : Multi step income statement computes the company’s revenues, expenses and profit or loss for a given period. It is more detailed and an elaborative version of single step income statement. To determine : The net income for the year. The total net income for the year is $237,000. Multi step income statement Particulars Amount (in $) Amount (in $) Sales 2,640,000 Less: cost of goods sold (1,040,000) Gross profit: 1,600,000 Operating expenses: Depreciation on building 400,000 Depreciation on equipment 220,000 Other operating expenses 328,000 Loss on sale of equipment 24,000 Total operating expense (972,000) Operating income: 628,000 Loss from settlement of lawsuit (36,000) Gain from settlement of lawsuit 68,000 Interest income 20,000 52,000 Income before taxes from continuing operations 680,000 Less: income tax (170,000) Income from continuing operations 510,000 Discontinued operations: Loss from operating a discontinued segment (net) (90,000) Loss on sale of discontinued operations assets (net) (135,000) Income from extraordinary items (225,000) Loss on hurricane damage (48,000) Net income 237,0000

a. Introduction : Multi step income statement computes the company’s revenues, expenses and profit or loss for a given period. It is more detailed and an elaborative version of single step income statement. To determine : The tax effects and after tax amounts of the items labelled as pre tax. The after tax amount of Loss from operating a discontinued segment is $90,000. The after tax amount of Loss on discontinued segment’s assets is $135,000. The correction of previous year’s expense has already been adjusted. Multi step income statement Particulars Amount (in $) Amount (in $) Sales 2,640,000 Less: cost of goods sold (1,040,000) Gross profit: 1,600,000 Operating expenses: Depreciation on building 400,000 Depreciation on equipment 220,000 Other operating expenses 328,000 Loss on sale of equipment 24,000 Total operating expense (972,000) Operating income: 628,000 Loss from settlement of lawsuit (36,000) Gain from settlement of lawsuit 68,000 Interest income 20,000 52,000 Income before taxes from continuing operations 680,000 Less: income tax (170,000) Income from continuing operations 510,000 Discontinued operations: Loss from operating a discontinued segment (net) (90,000) Loss on sale of discontinued operations assets (net) (135,000) Income from extraordinary items (225,000) Loss on hurricane damage (48,000) Net income 237,0000 b. Introduction : Multi step income statement computes the company’s revenues, expenses and profit or loss for a given period. It is more detailed and an elaborative version of single step income statement. To determine : The income from continuing operations before tax, income tax expenses and the loss from continuing operations. Income from continuing operations before tax is $680,000. Income tax expenses are $170,000. Income from continuing operations are $510,000. Multi step income statement Particulars Amount (in $) Amount (in $) Sales 2,640,000 Less: cost of goods sold (1,040,000) Gross profit: 1,600,000 Operating expenses: Depreciation on building 400,000 Depreciation on equipment 220,000 Other operating expenses 328,000 Loss on sale of equipment 24,000 Total operating expense (972,000) Operating income: 628,000 Loss from settlement of lawsuit (36,000) Gain from settlement of lawsuit 68,000 Interest income 20,000 52,000 Income before taxes from continuing operations 680,000 Less: income tax (170,000) Income from continuing operations 510,000 Discontinued operations: Loss from operating a discontinued segment (net) (90,000) Loss on sale of discontinued operations assets (net) (135,000) Income from extraordinary items (225,000) Loss on hurricane damage (48,000) Net income 237,0000 c. Introduction : Multi step income statement computes the company’s revenues, expenses and profit or loss for a given period. It is more detailed and an elaborative version of single step income statement. To determine : The total amount of after tax income associated with discontinued segment. The total amount of after tax income(loss) associated with discontinued segment is $225,000. Multi step income statement Particulars Amount (in $) Amount (in $) Sales 2,640,000 Less: cost of goods sold (1,040,000) Gross profit: 1,600,000 Operating expenses: Depreciation on building 400,000 Depreciation on equipment 220,000 Other operating expenses 328,000 Loss on sale of equipment 24,000 Total operating expense (972,000) Operating income: 628,000 Loss from settlement of lawsuit (36,000) Gain from settlement of lawsuit 68,000 Interest income 20,000 52,000 Income before taxes from continuing operations 680,000 Less: income tax (170,000) Income from continuing operations 510,000 Discontinued operations: Loss from operating a discontinued segment (net) (90,000) Loss on sale of discontinued operations assets (net) (135,000) Income from extraordinary items (225,000) Loss on hurricane damage (48,000) Net income 237,0000 d. Introduction : Multi step income statement computes the company’s revenues, expenses and profit or loss for a given period. It is more detailed and an elaborative version of single step income statement. To determine : The net income for the year. The total net income for the year is $237,000. Multi step income statement Particulars Amount (in $) Amount (in $) Sales 2,640,000 Less: cost of goods sold (1,040,000) Gross profit: 1,600,000 Operating expenses: Depreciation on building 400,000 Depreciation on equipment 220,000 Other operating expenses 328,000 Loss on sale of equipment 24,000 Total operating expense (972,000) Operating income: 628,000 Loss from settlement of lawsuit (36,000) Gain from settlement of lawsuit 68,000 Interest income 20,000 52,000 Income before taxes from continuing operations 680,000 Less: income tax (170,000) Income from continuing operations 510,000 Discontinued operations: Loss from operating a discontinued segment (net) (90,000) Loss on sale of discontinued operations assets (net) (135,000) Income from extraordinary items (225,000) Loss on hurricane damage (48,000) Net income 237,0000

Solution Summary: The author explains how Multi step income statement computes the company's revenues, expenses, and profit or loss for a given period.

Loose Leaf for Financial Accounting: Information for Decisions

Loose Leaf for Financial Accounting: Information for Decisions

9th Edition

ISBN: 9781260158762

Author: John J Wild

Publisher: McGraw-Hill Education

See similar textbooks

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

Blurred answer

Chapter 13, Problem 5PSB

Chapter 13, Problem 13SP

Chapter 13 Solutions

Loose Leaf for Financial Accounting: Information for Decisions

Ch. 13 - Explain the difference between financial reporting...Ch. 13 - Prob. 2DQ Ch. 13 - Prob. 3DQ Ch. 13 - Prob. 4DQ Ch. 13 - Prob. 5DQ Ch. 13 - Prob. 6DQ Ch. 13 - Prob. 7DQ Ch. 13 - Prob. 8DQ Ch. 13 - Prob. 9DQ Ch. 13 - Prob. 10DQ

Ch. 13 - Prob. 11DQ Ch. 13 - Prob. 12DQ Ch. 13 - Prob. 13DQ Ch. 13 - Prob. 14DQ Ch. 13 - Prob. 15DQ Ch. 13 - Prob. 16DQ Ch. 13 - Prob. 17DQ Ch. 13 - Prob. 1QS Ch. 13 - Prob. 2QS Ch. 13 - Prob. 3QS Ch. 13 - Prob. 4QS Ch. 13 - Prob. 5QS Ch. 13 - Prob. 6QS Ch. 13 - Prob. 7QS Ch. 13 - Prob. 8QS Ch. 13 - Which of the following gains or losses would...Ch. 13 - Prob. 1E Ch. 13 - Prob. 2E Ch. 13 - Prob. 3E Ch. 13 - Prob. 4E Ch. 13 - Prob. 5E Ch. 13 - Prob. 6E Ch. 13 - Prob. 7E Ch. 13 - Prob. 10E Ch. 13 - Prob. 12E Ch. 13 - Prob. 13E Ch. 13 - Prob. 14E Ch. 13 - Prob. 15E Ch. 13 - Prob. 16E Ch. 13 - Prob. 1PSA Ch. 13 - Prob. 2PSA Ch. 13 - Prob. 3PSA Ch. 13 - Prob. 5PSA Ch. 13 - Prob. 6PSA Ch. 13 - Selected comparative financial statements of...Ch. 13 - Prob. 2PSB Ch. 13 - Prob. 3PSB Ch. 13 - Prob. 5PSB Ch. 13 - Prob. 6PSB Ch. 13 - Prob. 13SP Ch. 13 - Prob. 2FSA Ch. 13 - Prob. 3FSA Ch. 13 - Prob. 1BTN Ch. 13 - Prob. 5BTN

Knowledge Booster

Background pattern image

Similar questions

Recommended textbooks for you

Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
SWFT Comprehensive Volume 2019
Accounting
ISBN:9780357233306
Author:Maloney
Publisher:Cengage
SWFT Corp Partner Estates Trusts
Accounting
ISBN:9780357161548
Author:Raabe
Publisher:Cengage
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
SWFT Individual Income Taxes
Accounting
ISBN:9780357391365
Author:YOUNG
Publisher:Cengage
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:9781337679503
Author:Gilbertson
Publisher:Cengage

Text book image

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:Cengage Learning

Text book image

SWFT Comprehensive Volume 2019

Accounting

ISBN:9780357233306

Author:Maloney

Publisher:Cengage

Text book image

SWFT Corp Partner Estates Trusts

Accounting

ISBN:9780357161548

Author:Raabe

Publisher:Cengage

Text book image

Managerial Accounting: The Cornerstone of Busines...

Accounting

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Cengage Learning

Text book image

SWFT Individual Income Taxes

Accounting

ISBN:9780357391365

Author:YOUNG

Publisher:Cengage

Text book image

Century 21 Accounting Multicolumn Journal

Accounting

ISBN:9781337679503

Author:Gilbertson

Publisher:Cengage

SEE MORE TEXTBOOKS