Question

The following amounts appeared on Plymouth Electronics’ adjusted trial balance as of December 31, 2020.

	Debit			Credit
Merchandise inventory	$	18,900
Other assets		481,785
Liabilities				$	306,370
Celine Plymouth, capital					243,975
Celine Plymouth, withdrawals		66,400
Sales					936,000
Sales discounts		13,980
Sales returns and allowances		5,115
Interest income					660
Cost of goods sold		716,000
Sales salaries expense		78,600
Office salaries expense		55,900
Rent expense, selling space		32,400
Rent expense, office space		2,400
Store supplies expense		1,560
Office supplies expense		705
Depreciation expense, store equipment		8,310
Depreciation expense, office equipment		2,160
Insurance expense		2,160
Totals	$	1,487,005		$	1,487,005

Required:
1. Prepare a 2020 classified multiple-step income statement for Plymouth Electronics.

2. Prepare a single-step income statement.

Answer 1

PLYMOUTH ELECTRONICS
INCOME STATEMENT
IN MULTIPLE STEP FORM
Particulars	Amount	Amount
Sales Revenue	$     9,36,000
Less: Sales Returns and allowances	$           5,115
Less: Sales Discount	$         13,980
		$    9,16,905
Less : Cost of Goods Sold		$    7,16,000
Gross Profit		$    2,00,905
Less : Operating Expenses
Sales Salaries expenses	$         78,600
Office Salaries expenses	$         55,900
Rent Expenses, Selling space	$         32,400
Rent Expenses, Office space	$           2,400
Store Supplies Expenses	$           1,560
Office Supplies Expenses	$               705
Depreciation Expenses , store equipment	$           8,310
Depreciation Expenses , Office equipment	$           2,160
Insurance expenses	$           2,160
		$    1,84,195
Operating Income		$        16,710
Non- Operarting and others
Interest Income	$               660
		$              660
Net Income		$        17,370
PLYMOUTH ELECTRONICS
INCOME STATEMENT
SINGLE-STEP INCOME STATEMENT
Particulars	Amount	Amount
Sales Revenue	$     9,36,000
Less: Sales Returns and allowances	$           5,115
Less: Sales Discount	$         13,980
		$    9,16,905
Interest Income		$              660
Total Revenue		$    9,17,565
Less: Expenses:
Less : Cost of Goods Sold	$     7,16,000
Sales Salaries expenses	$         78,600
Office Salaries expenses	$         55,900
Rent Expenses, Selling space	$         32,400
Rent Expenses, Office space	$           2,400
Store Supplies Expenses	$           1,560
Office Supplies Expenses	$               705
Depreciation Expenses , store equipment	$           8,310
Depreciation Expenses , Office equipment	$           2,160
Insurance expenses	$           2,160
Total Expenses		$    9,00,195
Net Income (Total income - Total expenses)		$        17,370