Beasley, Inc., reports the following amounts in its December 31, 2021, income statement. Sales revenue $ 350,000 Income tax expense $ 36,000 Interest expense 13,000 Cost of goods sold 120,000 Salaries expense 35,000 Advertising expense 25,000 Utilities expense 45,000 Prepare a multiple-step income statement.

Question

Business

Tripp Walters

5 March, 16:09

Beasley, Inc., reports the following amounts in its December 31, 2021, income statement. Sales revenue $ 350,000 Income tax expense $ 36,000 Interest expense 13,000 Cost of goods sold 120,000 Salaries expense 35,000 Advertising expense 25,000 Utilities expense 45,000 Prepare a multiple-step income statement.

+1

Answers (1)

Know the Answer?

Nathen Campos · Answer 1

Instructions are listed below.

Explanation:

Giving the following information:

Sales revenue $350,000

Income tax expense $36,000

Interest expense $13,000

Cost of goods sold $120,000

Salaries expense $35,000

Advertising expense $25,000

Utilities expense $45,000

The multiple-step income statement uses the following structure:

Sales

Less:

Cost of goods sold

= Gross margin

Less:

Operating expenses:

Selling expenses

Administrative expenses

= income from operations

Less:

Interest expense

Tax expense

= Net income

For this case:

Sales = 350,000

COGS = (120,000)

Gross profit = 230,000

Operating expenses:

Salaries expense = (35,000)

Advertising expense = (25,000)

Utilities expense (45,000)

Income from operations = 125,000

Income tax expense = (36,000)

Interest expense = (13,000)

Net income = 76,000