Prepare an Income Statement from the following information: Sales $500,000 Sales
ID: 2350122 • Letter: P
Question
Prepare an Income Statement from the following information:Sales $500,000
Sales Discount $650
Sales Return as Allowance $3,000
Beginning Merchandise Inventory $85,000
Purchases $265,000
Transport In $4,200
Purchase Discount $1,500
Purchase Return Allowance $1,700
Closing Merchandise Inventory $76,000
Advertisement Expenses $4,500
Insurance Expenses $1,500
Bank and Fees $1,200
Maintenance Expenses $3,200
Payroll Tax Expenses $7,600
Rent Expenses $12,000
Salaries Expenses $36,000
Supplies Expenses $3,200
Utilities Expenses $1,700
Fed Corp IncomeTax Expenses $1,200
Explanation / Answer
Income Statement Sales 500000 Add: allownce 3000 Less: Sales discount 650 Total sales value 502350 Less:COGS; Beginning inventory 85000 Add: purchase 265000 Add: Transport 4200 Less: Purchase discount 1500 Add: Return allownace 1700 Less Closing 76000 COGS 278400 Gross sales 223950 Less: Expense Advertisemnt 4500 Insurance 1500 Bank and fees 1200 Maintenance 3200 Payroll tax 7600 Rnt exp. 12000 Salaries 36000 Supplies exp. 3200 Utilities Exp. 1700 Federal income tax 1200 Total Exp. 72100 Net income 151850