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Preparing a Multi-Step and Single Step Income Statement.

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The accountant of Whitney Houston Shoe Co. has compiled the following information from the company's records as a basis for an income statement for the year ended December 31,2007.
Rental Revenue $29,000
Interest on notes payable $18,000
Market appreciation on land above cost $31,000
Wages and salaries - sales $114,800
Materials and supplies - sales $17,600
Income tax $37,400
Wages and Salaries - administrative $135,900
other administrative expenses $51,700
cost of goods sold $496,000
net sales $980,000
depreciation on plant assets (70% selling, 30% administrative) $65,000
Cash Dividends declared $16,000

There were 20,000 shares of common stock outstanding during the year.
(a) Prepare a multiple-step income statement
(b) Prepare a single-step income statement
(c) Which format do you prefer? Discuss

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Solution Summary

The problem deals with how to prepare a single-step and a multi-step income statement in Excel.

Solution provided by:
Chidi Ngene, M. Sc.
Education
  • B. Sc., University of Nigeria
  • M. Sc., London South Bank University
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