Two
accountants for the firm of Elwes and Wright are arguing about the merits of presenting
an income statement in
E4-5 (Multiple-Step and Single-Step) Two accountants for the firm of Elwes and Wright are arguing about the
merits of presenting an income statement in a multiple-step versus a
single-step format. The discussion involves the following 2014 information
related to P. Bride Company ($000 omitted).
|
Administrative expenses
|
|
|
Officers' salaries
|
$4,900
|
|
Depreciation of office furniture and equipment
|
3,960
|
|
Cost of goods sold
|
60,570
|
|
Rent revenue
|
17,230
|
|
Selling expenses
|
|
|
Transportation-out
|
2,690
|
|
Sales commissions
|
7,980
|
|
Depreciation of sales equipment
|
6,480
|
|
Sales
|
96,500
|
|
Income tax
|
9,070
|
|
Interest expense
|
1,860
|
Instructions
(a) Prepare
an income statement for the year 2014 using the multiple-step form. Common
shares outstanding
for 2014 total 40,550 (000 omitted).
(b) Prepare
an income statement for the year 2014 using the single-step form. Common shares outstanding
for 2014 total 40,550 (000 omitted).
(c) Which
one do you prefer? Discuss.
TUTORIAL PREVIEW
(a) Prepare
an income statement for the year 2014 using the multiple-step form. Common
shares outstanding
for 2014 total 40,550 (000 omitted).
P. BRIDE COMPANY
Multi-Step Income Statement
For the Year Ended December 31, 2014
(In thousands, except earnings per share)
|
Sales
|
$96,500
|
|
Cost of goods sold
|
60,570
|
|
Gross profit
|
35,930
|
File name: E4-5 P. Bride.xls File
type: xls PRICE:
$5
