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Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
ISBN: 9781337788281

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BuyFindarrow_forward

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
ISBN: 9781337788281
Textbook Problem
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Brandt Corporation had sales revenue of $500,000 for the current year. For the year, its cost of goods sold was $240,000, its operating expenses were $50,000, its interest revenue was $2,000, and its interest expense was $12,000. Brandt’s income tax rate is 30%. Prepare Brandt’s multiple-step income statement for the current year.

To determine

Prepare the multiple-step income statement of Company B for the current year.

Explanation

Multi-step income statement: The income statement represented in multi-steps with several subtotals, to report the income from principal operations, and separate the other expenses and revenues which affect net income, is referred to as multi-step income statement.

Prepare the multiple-step income statement of Company B for the current year:

Corporation B
Income Statement
For Year Ended December 31, Current Year
ParticularsAmount ($)

Amount

($)

Sales revenue $500,000
Less: Cost of goods sold 240,000
     Gross profit  $260,000
Less: Operating expenses 50,000
Operating income 

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