Question

For Mortenson Company, the following information is available: Cost of goods sold is $390,000; Dividend revenue is $15,000; Income tax expense is $36,000; Operating expenses is $138,000; Sales revenue is $600,000.

Answer 1

Answer:

C) Should be reported at $210,000

Explanation:

The computation of the gross profit in case of the multi-step income statement is presented below:

                                   Mortenson Company

                            Multi step income statement

Sales                                    $600,000

Less: Cost of goods sold   -$390,000

Gross profit                          $210,000

After deducting the cost of goods sold from the sales we can get the gross profit