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1.
Concept introduction:
There are two ways to present an income statement: single-step and multi-step. In the single-step income statement, all the expenses are shown under a single heading and net income is calculated in one step. In the multi-step income statement the net income is calculated after showing multiple steps due to the bifurcation of expenses.
To prepare: The multiple income statement.
2.
Concept introduction:
There are two ways to present an income statement: single-step and multi-step. In the single-step income statement, all the expenses are shown under a single heading and net income is calculated in one step. In the multi-step income statement the net income is calculated after showing multiple steps due to the bifurcation of expenses.
To prepare: The single income statement.
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Chapter 4 Solutions
Connect Access Card for Financial Accounting: Information and Decisions
- Prepare a horizontal analysis of the following excerpt of an income statement. Eye Witness Security GmbH Income Statement 2012 2011 Net sales €540.400 €573.000 Cost of goods sold 130.300 165.800 Gross profit (loss) 410.100 407.200 Operating expenses 264.900 205.100 Net income (loss) €145.200 €202.100arrow_forwardThe following table shows income statement and balance sheet data for five U.S. industries in 2017. INCOME STATEMENT AND BALANCE SHEET FOR 2017SELECTED U.S. INDUSTRIES FOR 2017(Figures in $ billions) Food Pharmaceuticals Oiland Coal Computers andPeripherals FoodStores Income Statement Data: Sales $ 666.9 $ 427.5 $ 802.0 $ 216.0 $ 474.2 Cost of goods sold 596.1 352.4 757.8 189.7 451.0 Balance Sheet Data: Inventory $ 67.8 $ 56.8 $ 44.2 $ 11.3 $ 27.9 Accounts receivable 56.6 68.1 52.8 23.7 7.4 Accounts payable 49.0 42.3 50.3 39.5 23.7 Note: Cost of goods sold includes selling, general, and administrative expenses. Source: U.S. Department of Commerce, Quarterly Financial Report for Manufacturing, Mining, Trade Corporations, and Selected Service Industries,…arrow_forwardBramble Corp. reported the following in its 2025 and 2024 income statements. Net sales Cost of goods sold Operating expenses Income tax expense Net income Gross profit rate 2025 $154,000 86,240 27,720 21,560 $18,480 (a1) Determine the company's gross profit rate and profit margin for both years. (Round answers to 1 decimal place, eg. 52.7%) Profit margin 2024 $124,000 69,440 16,120 13,640 $24,800 2025 2024 %arrow_forward
- The following is the extract of the Income statement of a Rubber Glove company in Malaysia : STATEMENTS OF COMPREHENSIVE INCOME 2016 2017 2018 2019 2020 Revenue 1,377,931,000 1,529,077,000 2,079,432,000 2,053,916,000 2,314,454,000 Cost of sales -1,150,360,000 -1,155,975,000 -1,640,550,000 -1,818,767,000 -1,851,563,200 Gross profit 227,571,000 373,102,000 438,882,000 235,149,000 462,890,800 Other Income 8,973,000 6,979,000 10,372,000 26,689,000 15,634,000 Selling and distribution expenses -46,520,000 -95,484,000 -66,008,000 -67,121,000 -71,401,000 Administration expenses -46,155,000 -53,091,000 -80,987,000 60,495,000 -178,910,800…arrow_forwardAssume U.S. GAAP (generally accepted accounting principles) applies unless otherwise noted. An analyst is forecasting EPS for a company. She prepares the following common sized data from its recent annual report and estimates sales for 2009. Sales $ millions Sales as % of sales Cost of goods sold Operating Expenses Interest expense Restructuring expense 2022 forecast 2,250.0 Pre-tax margin Taxes (35%) Net Income 2021 actual 2,150.0 100.00% 45.00% 40.00% 4.02% 7.20% 3.78% 1.32% 2.46% The capital structure of the company has not changed, and the company has no short term interest bearing debt outstanding. The projected net income (in $ millions) for 2022 is closest to: 45.00% 40.00% 3.72% 2020 actual 1,990.0 100.00% 11.28% 3.95% 7.33%arrow_forwardSelected comparative financial statements of Haroun Company follow. HAROUN COMPANY Comparative Income Statements For Years Ended December 31, 2021–2015 ($ thousands) 2021 2020 2019 2018 2017 2016 2015 Sales $ 2,272 $ 1,989 $ 1,810 $ 1,659 $ 1,548 $ 1,440 $ 1,180 Cost of goods sold 1,634 1,329 1,143 1,001 930 870 693 Gross profit 638 660 667 658 618 570 487 Operating expenses 486 380 349 257 223 220 183 Net income $ 152 $ 280 $ 318 $ 401 $ 395 $ 350 $ 304 HAROUN COMPANY Comparative Year-End Balance Sheets December 31, 2021–2015 ($ thousands) 2021 2020 2019 2018 2017 2016 2015 Assets Cash $ 85 $ 113 $ 117 $ 120 $ 124 $ 123 $ 127 Accounts receivable, net 613 644 583 447 394 373 263 Merchandise inventory 2,218 1,615 1,411 1,189 1,068 907 658 Other current assets 57 51 32 56 48 48 25 Long-term investments 0 0 0 175 175 175 175 Plant assets, net 2,715 2,704 2,365 1,334 1,379 1,226 1,052 Total assets $ 5,688 $ 5,127 $ 4,508 $ 3,321…arrow_forward
- The following select account data is taken from the records of Reese Industries for 2019. A. Use the data provided to compute net sales for 2019. B. Prepare a simple income statement for the year ended December 31, 2019. C. Compute the gross margin for 2019. D. Prepare a multi-step income statement for the year ended December 31, 2019.arrow_forwardGIVE THE COMPARATIVE INCOME STATEMENT HORIZONTAL ANALYSIS FROM THE FOLLOWING INCOME STATEMENT BELOW JOLLIBEE INCOME STATEMENT ITEM 2016 2017 2018 2019 2020 Sales/Revenue 113.81B 133.61B 161.17B 179.63B 129.31B Sales Growth - 17.40% 20.62% 11.45% -28.01% Cost of Goods Sold (COGS) incl. D&A - - 132.96B 150.88B 115.39B COGS Growth - - - 13.47% -23.52% COGS excluding D&A 89.27B 105.39B 121.08B 137.38B 100.82B Depreciation & Amortization Expense 4B 4.75B 11.89B 13.5B 14.57B Depreciation 3.93B 4.66B 11.73B 13.34B 14.32B Amortization of Intangibles 68.99M 78.95M 151.82M 145.42M 245.23M Gross Income 20.54B 23.48B 28.21B 28.75B 13.92B Gross Income Growth - 14.30% 20.12% 1.93% -51.57% Gross Profit Margin - - - - 10.77% SG&A Expense - - 17.64B 20.21B 20.42B SGA Growth - - - 14.57% 1.02%…arrow_forwardThe following table shows income statement and balance sheet data for five U.S. industries in 2017. INCOME STATEMENT AND BALANCE SHEET FOR 2017 SELECTED U.S. INDUSTRIES FOR 2017 (Figures in $ billions) Oil and Coal Computers and Peripherals Food Food Pharmaceuticals Stores Income Statement Data: $ 682.9 $ 443.5 $ 232.0 221.7 $ 490.2 467.0 Sales $ 818.0 Cost of goods sold Balance Sheet Data: 612.1 368.4 773.8 Inventory Accounts receivable Accounts payable $ 83.8 72.6 $ 72.8 84.1 $ 27.3 39.7 87.5 $ 43.9 23.4 39.7 60.2 68.8 65.0 58.3 66.3 Note: Cost of goods sold includes selling, general, and administrative expenses. Source: U.S. Department of Commerce, Quarterly Financial Report for Manufacturing, Mining, Trade Corporations, and Selected Service Industries, Quarter 3, issued December 2017. Calculate the cash cycle for each industry. (Negative amounts should be indicated by a minus sign. Use 365 days a year. Do not round intermediate calculations. Round your answers to 1 decimal place.)…arrow_forward
- ABC Co. is a manufacturing company and its selected financial statements items are given as following. Net Sales 1 - equals to 32000 for the year 2020 and 28000 for the year 2019. COGS equals to 24000 and 21000 respectively for the year 2020 and 2019. Accounts Receivable for the year 2020 equals to 8500 and 7800 for the year 2019. Inventory equals to 7500 and 6800 respectively for the year 2020 and 2019. Accounts Payable for the year 2020 equals to 11000 and 9000 for the year 2019. (All numbers are in dollars). What is days sales outstanding for the year 2020? a) 83 b) S0137 93 103 d) 113arrow_forwardSelected comparative financial statements of Haroun Company follow. HAROUN COMPANY Comparative Income Statements For Years Ended December 31, 2021–2015 ($ thousands) 2021 2020 2019 2018 2017 2016 2015 Sales $ 2,318 $ 2,030 $ 1,847 $ 1,693 $ 1,580 $ 1,469 $ 1,204 Cost of goods sold 1,667 1,356 1,167 1,021 949 887 707 Gross profit 651 674 680 672 631 582 497 Operating expenses 497 389 356 263 228 225 187 Net income $ 154 $ 285 $ 324 $ 409 $ 403 $ 357 $ 310 HAROUN COMPANY Comparative Year-End Balance Sheets December 31, 2021–2015 ($ thousands) 2021 2020 2019 2018 2017 2016 2015 Assets Cash $ 89 $ 118 $ 122 $ 125 $ 130 $ 128 $ 132 Accounts receivable, net 640 672 608 467 411 389 275 Merchandise inventory 2,315 1,685 1,472 1,241 1,114 946 686 Other…arrow_forwardIn the income statement below, ABC Trade Inc. wants to find the resulting net income for the year 2018 (in million). What is the right amount? Income Statement ($ Million) Year End 2015 2016 2017 2018 Sales 1,234.90 1,251.70 1,300.40 1,334.40 Cost of Sales (679.10) (659.00) (681.30) (667.00) Gross Operating Income Selling & Administration (339.70) (348.60) (351.20) (373.30) Depreciation (47.50) (52.00) (55.90) (75.20) Other Income/Expenses 11.80 7.60 7.00 8.20 Earnings Before Interest and Taxes Interest Income 1.30 1.40 1.70 2.00 Interest Expense (16.20) (15.10) (20.50) (23.70) Pre Tax Income Income Taxes (56.80) (64.20) (67.50) (72.60) Net Income Dividends (38.30) (38.70) (39.80) (40.10) Addition to Retained Earnings Group of answer choices 121.8 108.7 132.7 132.8 No choice givenarrow_forward
- Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College