Question

Wolford Department Store is located in midtown Metropolis. During the past several years, net income has been declining because suburban shopping centers have been attracting business away from city areas. At the end of the company?s fiscal year on November 30, 2017, these accounts appeared in its adjusted trial balance.Accounts Payable $ 34,304Accounts Receivable 22,016Accumulated Depreciation?Equipment 87,040Cash 10,240Common Stock 44,800Cost of Goods Sold 786,304Freight-Out 7,936Equipment 200,960Depreciation Expense 17,280Dividends 15,360Gain on Disposal of Plant Assets 2,560Income Tax Expense 12,800Insurance Expense 11,520Interest Expense 6,400Inventoryv 33,536Notes Payable 55,680Prepaid Insurance 7,680Advertising Expense 42,880Rent Expense 43,520Retained Earnings 18,176Salaries and Wages Expense 149,760Sales Revenue 1,157,120Salaries and Wages Payable 7,680Sales Returns and Allowances 25,600Utilities Expense 13,568Additional data: Notes payable are due in 2021.Prepare a multiple-step income statement.

Answer 1

2017 Income Statement

$ 1.157.120 Sales

-$ 25.600 Sales returns and allowances

$ 1.131.520 Net Sales Revenues

-$ 17.280 Depreciations

-$ 786.321 Cost of goods sold

$ 327.919 Gross PROFIT

-$ 42.880 Advertising expense

-$ 13.568 Utilities Expenses

-$ 149.760 Salaries and Wages Expenses

-$ 43.520 Rent expenses

-$ 7.936 Delivery Expenses

-$ 257.664 Operating EXPENSES

$ 70.255 Operating INCOME

$ 2.560 Other Incomes

-$ 6.400 Interest Expenses

-$ 11.520 Insurance Expenses

-$ 15.360 NonOperating EXPENSES

$ 54.895 NET INCOME AFTER TAXES

-$ 12.800 Income Tax Expenses

$ 42.095 Net INCOME

Step-by-step explanation:

In the multistep income it's possible to segregate the operative expenses and revenues of the non operative, it also shows the gross profit, which is

the Net Sales Revenues less the Costo of Goods Sold.

First it's shown the Gross Profit, then substracted the operating expenses

to arrive at operating income.

Finally with the non operating movements we have the net Income After Taxes and the with the taxes expenses we have the Net Income of the company.