FINANCIAL ACCT.:TOOLS...(LL)-W/ACCESS
8th Edition
ISBN: 9781119250913
Author: Kimmel
Publisher: WILEY
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Chapter 5, Problem 5.8E
(a)
To determine
Multi step income statement: A multiple step income statement refers to the income statement that shows the operating, and non-operating activities of the business, under separate head. In different steps of the multi-step income statement, principal operating activities are reported that starts from the record of sales revenue with all contra sales revenue account like sales returns, allowances and sales discounts.
To Prepare: The multi-step income statement of Company D for the year ended December 31, 2017.
(b)
To determine
Gross Profit Rate: It is the financial ratio that evaluates the money left out of the total revenues after deducting the cost of goods sold. Thus, it shows the relationship between the gross profit on sales and net sales. It is calculated by using the following formula:
Profit Margin: It measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula:
To Determine: The profit margin and gross profit rate of Company D for the year 2017.
(c)
To determine
To Explain: Whether the decline in profit margin in 2017 is a cause for concern.
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In its income statement for the year ended December 31, 2017, Sandhill Co. reported the following condensed data.
Salaries and wages expenses
$953,250
Loss on disposal of plant assets
$ 171,175
Cost of goods sold
2,023,350
Sales revenue
4,530,500
Interest expense
145,550
Income tax expense
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Interest revenue
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Prepare a multiple-step income statement. (List other revenues before other expenses.)
SANDHILL CO.Income Statementchoose the accounting period
For the Year Ended December 31, 2017December 31, 2017For the Month Ended December 31, 2017
Select an opening section name
DividendsNet Income / (Loss)Retained Earnings, January 1Retained Earnings, December 31Sales RevenuesTotal RevenuesSalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome Before Income TaxesOther Revenues and…
Brick & Stone
Income Statement for the year ended 31 December 2016
Notes $ $
Sales 2,500,000
Cost of Sales 1 1,100,000
Gross Profit 1,400,000
Expenses
Salaries & Wages 2 760,000
Employer NIS Contribution 2,400
Rent and Rates 3 240,000
Insurance 50,000
Maintenance 120,000
Depreciation 4 55,000
Loss on Disposal of Vehicle 5 10,000
Telephone 6 35,000
Electricity 7 54,000
Utilities 70,000
Entertainment 8 100,000
Donations 9 85,000
Provision for Bad Debts 10 80,000
Fines and Penalties 11 15,000
Drawings 105,000
1,781,400
Net Profit/ (Loss) (381,400)
Brick & Stone
Notes to the Income Statement
The Cost of Sales includes goods valuing $250,000 that were purchased for Mr. Stone’s personal use.
Salaries and Wages include $25,000 per month, and $20,000 per month, paid to Mr. Stone and Mr. Brick respectively.
$65,000 of the rent relates to the private dwelling of Mr. Brick’s wife.
The rates of depreciation on the fixed assets of the business are below those given in the…
In its income statement for the year ended December 31, 2022, Crane Company reported the following condensed data.
Salaries and wages expenses
$381,300
Loss on disposal of plant assets
$ 68,470
Cost of goods sold
809,340
Sales revenue
1,812,200
Interest expense
58,220
Income tax expense
20,500
Interest revenue
53,300
Sales discounts
131,200
Depreciation expense
254,200
Utilities expense
90,200
Prepare a multiple-step income statement. (List other revenues before other expenses.)
Chapter 5 Solutions
FINANCIAL ACCT.:TOOLS...(LL)-W/ACCESS
Ch. 5 - Prob. 1QCh. 5 - Prob. 2QCh. 5 - Prob. 3QCh. 5 - Prob. 4QCh. 5 - Waymon Co. has net sales of 100,000, cost of goods...Ch. 5 - Masie Ascot believes revenues from credit sales...Ch. 5 - (a) What is the primary source document for...Ch. 5 - Prob. 8QCh. 5 - As the end of Smyle Companys fiscal year...Ch. 5 - To encourage bookstores to buy a broader range of...
Ch. 5 - Goods costing 1,900 are purchased on account on...Ch. 5 - Prob. 12QCh. 5 - Prob. 13QCh. 5 - Prob. 14QCh. 5 - Prob. 15QCh. 5 - Prob. 16QCh. 5 - Prob. 17QCh. 5 - What merchandising account(s) will appear in the...Ch. 5 - What types of businesses are most likely to use a...Ch. 5 - Prob. 20QCh. 5 - In the following cases, use a periodic inventory...Ch. 5 - Prob. 22QCh. 5 - What factors affect a companys gross profit...Ch. 5 - Prob. 24QCh. 5 - Prob. 25QCh. 5 - On July 15, a company purchases on account goods...Ch. 5 - Presented here are the components in Salas...Ch. 5 - Prob. 5.2BECh. 5 - Prob. 5.3BECh. 5 - Prob. 5.4BECh. 5 - Prob. 5.5BECh. 5 - Explain where each of these items would appear on...Ch. 5 - Prob. 5.7BECh. 5 - Prob. 5.8BECh. 5 - Prob. 5.9BECh. 5 - Prob. 5.10BECh. 5 - Prob. 5.11BECh. 5 - Prob. 5.12BECh. 5 - Prob. 5.13BECh. 5 - Prob. 5.14BECh. 5 - Prob. 5.1DIECh. 5 - Prob. 5.2DIECh. 5 - Prob. 5.3DIECh. 5 - Prob. 5.4DIECh. 5 - Prob. 5.5DIECh. 5 - Prob. 5.6DIECh. 5 - Prob. 5.1ECh. 5 - Assume that on September 1, Office Depot had an...Ch. 5 - Prob. 5.3ECh. 5 - Prob. 5.4ECh. 5 - Prob. 5.5ECh. 5 - Prob. 5.6ECh. 5 - Prob. 5.7ECh. 5 - Prob. 5.8ECh. 5 - Prob. 5.9ECh. 5 - Prob. 5.10ECh. 5 - Prob. 5.11ECh. 5 - Prob. 5.12ECh. 5 - Prob. 5.13ECh. 5 - Prob. 5.14ECh. 5 - Prob. 5.15ECh. 5 - Prob. 5.1APCh. 5 - Prob. 5.2APCh. 5 - Prob. 5.3APCh. 5 - Prob. 5.4APCh. 5 - Prob. 5.5APCh. 5 - Prob. 5.6APCh. 5 - Prob. 5.7APCh. 5 - Prob. 5.8APCh. 5 - Prob. 5.9APCh. 5 - Prob. 5.1CACRCh. 5 - Prob. 5.2CACRCh. 5 - Prob. 5.1EYCTCh. 5 - Prob. 5.2EYCTCh. 5 - Prob. 5.3EYCTCh. 5 - Prob. 5.4EYCTCh. 5 - Prob. 5.6EYCTCh. 5 - Prob. 5.7EYCTCh. 5 - Prob. 5.8EYCTCh. 5 - Prob. 5.9EYCTCh. 5 - Explain the difference between the...Ch. 5 - For each of the following income statement line...Ch. 5 - Prob. 5.3IFRSCh. 5 - Prob. 5.4IFRS
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