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6 June, 01:58

North Company has completed all of its operating budgets. The sales budget for the year shows 50,160 units and total sales of $2,228,200. The total unit cost of making one unit of sales is $24. Selling and administrative expenses are expected to be $309,200. Interest is estimated to be $12,710. Income taxes are estimated to be $226,800. Prepare a budgeted multiple-step income statement for the year ending December 31, 2020.

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  1. 6 June, 05:03
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    North Company

    Budgeted multiple-step income statement for the year ending December 31, 2020

    Sales of $2,228,200

    Cost of Goods Sold ($24 x 50,160) ($1,203,840)

    Gross Profit $1,024,360

    Operating Expenses:

    Selling and administrative expenses ($309,200)

    Operating Income $715,160

    Non-Operating Expenses:

    Interest Expense ($12,710)

    Operating Income before tax $702,450

    Income taxes ($226,800)

    Operating Income after Tax $475,650

    Explanation:

    Multi-step Income statement segregate the Operating Income and Expenses from non operating Income and Expense. It shows the gross profit and net operating income separately.
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