Question

Wayman Corporation reports the following amounts in its December 31, 2018, income statement. Sales revenue $ 376,000 Income tax expense $ 48,000 Interest expense 18,000 Cost of goods sold 128,000 Salaries expense 38,000 Advertising expense 28,000 Utilities expense 48,000 Required: Prepare a multiple-step income statement.

Answer 1

Answer:

                                          Wayman Corporation

                Income statement for the year ended December 31, 2018

                                                        Amount in $       Amount in $

Sales revenue                                                              432,000    

Cost of goods sold                                                       (136,000)

Gross profit                                                                  296,000

Operating expenses

Salaries expense                                   46,000

Advertising expense                             36,000

Utilities expense                                    56,000          (138,000)

Operating income                                                         158,000

Non-operating or other

Interest expense                                                           (26,000)

Income before income taxes                                        132,000

Income tax expense                                                     (56,000)

Net income                                                                     76,000

Explanation:

A multiple income statement is one in which incomes and expenses are classified under operating and non-operating heads. Like other forms of income statement, it shows the income and expenses of an entity for a given period of time.