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Preparing an income statement - Coyote, Inc.

3.10. Prepare a multiple-step income statement for Coyote, Inc. from the following single-step
statement. Then write a 200-300 word summary discussing the implications of profitability and net income of the company.

Net sales $1,833,000
Interest income 13,000
Costs and expenses:
Cost of good sold 1,072,000
Selling expenses 279,000
General and admin. expenses 175,000
Depreciation 14,000
Interest expense 16,000
Income tax expense 116,000
Net income $ 174,000
XYZ Company
Multi-Step Income Statement

200x 201x 202x
Net Sales
Cost of Goods Sold
Gross Profit 0 0 0

Selling and Administrative Expenses
Depreciation and Amortization
Repairs and Maintenance

Operating Profit 0 0 0

Other Income (Expense)
Interest Income
Interest Expense

Earnings Before Interest and Taxes 0 0 0

Income Taxes

Net Earnings 0 0 0


Solution Preview

(Accounting coach, 2009)The multiple-step profit and loss statement segregates the operating revenues and operating expenses from the nonoperating revenues, nonoperating expenses, gains, and losses. The multiple-step income statement also shows the gross profit (net sales minus the cost of goods sold). Multiple income statement shows the gross profit, operating profits and net earnings of the business. There are three benefits ...

Solution Summary

The solution prepares an income statement for Coyote, Inc.