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27 September, 06:10

is the sole proprietor of Prestigious Pups , a business specializing in the sale of high-end pet gifts and accessories. Prestigious Pups ' sales totaled $ 986 comma 000 during the most recent year. During the year, the company spent $ 58 comma 500 on expenses relating to website maintenance, $ 30 comma 500 on marketing, and $ 29 comma 100 on wrapping, boxing, and shipping the goods to customers. Prestigious Pups also spent $ 643 comma 000 on inventory purchases and an additional $ 19 comma 700 on freight-in charges. The company started the year with $ 16 comma 250 of inventory on hand and ended the year with $ 16 comma 800 of inventory. Prepare Prestigious Pups ' income statement for the most recent year.

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  1. 27 September, 08:26
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    Instructions are listed below

    Explanation:

    An income statement is one of the three important financial statements used for reporting a company's financial performance over a specific accounting period. The income statement focuses on the four key items - revenue, expenses, gains, and losses. It does not cover receipts (money received by the business) or the cash payments/disbursements (money paid by the business).

    It follows the general structures:

    Revenues (+)

    Operating Revenue

    Non-Operating Revenue

    Total

    Expenses (-)

    Primary Activity Expenses

    Secondary Activity Expenses

    Total

    Gains (+)

    Losses (-)

    Net income/loss

    In this exercise:

    sales totaled $ 986000

    $58500 on expenses relating to website maintenance

    $30500 on marketing

    $29100 on wrapping, boxing, and shipping the goods to customers.

    $643000 on inventory purchases

    $19700 on freight-in charges.

    started the year with $16250 inventory

    ended the year with $ 16800 of inventory.

    Revenues = 986000

    Expenses (-)

    Primary Activity Expenses:

    Cost of goods sold = Initial inventory + purchase - ending inventory = $642450

    wrapping, boxing, and shipping = $29100

    Secondary Activity Expenses:

    website maintenance=58500

    marketing = $30500

    freight-in charges = $19700

    Total Expenses = $780250

    Net income = $205750
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