Homework Clinic
Social Science Clinic => Accounting => Topic started by: bobypop on Jul 6, 2018
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Using the single-step income statement for ABC Company prepare a multiple-step income statement.
ABC Company
Income Statement
Income
Net sales 1,750
Interest income 90
1,840
Costs and expenses
Cost of goods sold 1,000
Interest expense 70
Depreciation expense 220
Income tax expense 70
Advertising expense 110
General and administrative expenses 180
Net earnings 190
What will be an ideal response?
Question 2
A person authorized to write checks drawn on a checking account at a bank must sign and have on file with the bank a
a. deposit ticket.
b. signature card.
c. bank statement.
d. bank reconciliation.
e. payee card.
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Answer to Question 1
ABC Company
Income Statement
Net sales 1,750
Cost of goods sold 1,000
Gross profit 750
Depreciation expense 220
Advertising expense 110
General and administrative expenses 180
Operating profit 240
Interest income 90
Interest expense (70)
Earnings before taxes 260
Income tax expense 70
Net profit 190
Answer to Question 2
b