Elements of the Income Statement Gains Increases in equity net assets from

Elements of the income statement gains increases in

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Elements of the Income Statement Gains – Increases in equity (net assets) from peripheral or incidental transactions. Losses - Decreases in equity (net assets) from peripheral or incidental transactions. LO 2 Describe the content and format of the income statement.
4-10 Format referred to as multiple-step income statement . Separates operating transactions from nonoperating transactions. Matches costs and expenses with related revenues. Highlights certain components of income that analysts use assessing financial performance. Format of the Income Statement Intermediate Components LO 3 Prepare an income statement.
4-11 Common for companies to present some or all of the following sections and totals within the income statement. 1. Operating section 2. Nonoperating section 3. Income tax 4. Discontinued operations 5. Extraordinary items 6. Noncontrolling interest 7. Earnings per share Intermediate Components LO 3 Prepare an income statement.
4-12 CABRERA COMPANY Income Statement For The Year Ended December 31, 2014 1. Operating Section 2. Nonoperating Section 3. Income tax Multiple-Step Illustration 4-2
4-13 Condensed Income Statements Illustration 4-3 LO 3 Prepare an income statement.
4-14 Revenues Expenses Net Income Single- Step Single- Step No implication that one type of revenue or expense item has priority over another. Single-Step Income Statements Format of the Income Statement Illustration 4-5 LO 3 Prepare an income statement.
4-15 Sales 96,500 $ Cost of goods sold 60,570 Gross profit 35,930 Administrative expense: Operating Expenses: Officers' salaries 4,900 $ Selling expense 17,150 Depreciation 3,960 Administrative exense 8,860 Cost of goods sold 60,570 Total operating expenses 26,010 Rent revenue 17,230 Income from operations 9,920 Selling expense: Other revenue (expense): Freight-out 2,690 Rent revenue 17,230 Sales commissions 7,980 Interest expense (1,860) Depreciation 6,480 Total other 15,370 Sales 96,500 Income before tax 25,290 Income tax 9,070 Income tax 9,070 Interest expense 1,860 Net income 16,220 $ Income Statement For the year ended Dec. 31, 2014 Illustration (E4-5): Prepare a income statement from the data below using the multiple-step form. Format of the Income Statement Advance slide in presentation mode to reveal answers. LO 3 Prepare an income statement.
4-16 A separation of operating and non operating activities of a company exists in Question a.both a multiple-step and single-step income statement. b.a multiple-step but not a single-step income statement.c.a single-step but not a multiple-step income statement.d.neither a single-step nor a multiple-step income statement. Format of the Income Statement LO 3 Prepare an income statement.
4-17 Companies are required to report unusual and irregular items as part of net income so users can better determine the long- run earning power of the company. These income items fall into four general categories : 1.Unusual gains and losses. 2.Discontinued operations. 3.Extraordinary items. 4.Noncontrolling interest.

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