Question

Multiple-Step and Single-Step Income Statements, and Statement of Comprehensive Income

On December 31, 2019, Opgenorth Company listed the following items in its adjusted trial balance:

Loss from fire (pretax)	$8,000		General and administrative expenses	$17,000
Interest revenue	3,000		Sales	180,000
Selling expenses	15,000		Unrealized decrease in fair value of
Cost of goods sold	90,000		available-for-sale securities	1,800
Loss on sale of equipment (pretax)	2,000

Additional data:

1. Seven thousand shares of common stock have been outstanding the entire year.
2. The income tax rate is 30% on all items of income.

Required:

1. Prepare a 2019 multiple-step income statement. Round earnings per share to two decimal places.

OPGENORTH COMPANY
Income Statement
For Year Ended December 31, 2019
		$
		$
Operating expenses
	$
		$
Other items
	$
		$
		$
Components of Income		EPS

2. Prepare a 2019 single-step income statement. Round earnings per share to two decimal places.

OPGENORTH COMPANY
Income Statement
For Year Ended December 31, 2019
Revenues
	$
Total revenues		$
Expenses
	$
Total expenses
		$
Components of Income		EPS

3. Prepare a 2019 statement of comprehensive income.

OPGENORTH COMPANY
Statement of Comprehensive Income
For Year Ended December 31, 2019
	$
Other comprehensive loss
	$

Answer 1

1. Prepare a 2019 multiple-step income statement. Round earnings per share to two decimal places.

OPGENORTH COMPANY
Income Statement
For Year Ended December 31, 2019
Sales		$180000
Cost of goods sold		90000
Gross profit		$90000
Operating expenses
Selling expense	$15000
General and administrative expenses	17000
Total operating expense		32000
Operating income		$58000
Other items
Interest revenue	$3000
Loss on sale of equipment (pretax)	-2000
Loss from fire	-8000	-7000
Income before tax		51000
Income tax		$15300
Net income		35700
Components of Income		EPS
EPS (35700/7000)		5.10

2. Prepare a 2019 single-step income statement. Round earnings per share to two decimal places.

OPGENORTH COMPANY
Income Statement
For Year Ended December 31, 2019
Revenues
Sales	$180000
Interest revenue	3000
Total revenues		$183000
Expenses
Cost of goods sold	$90000
Selling expense	15000
General and administrative expense	17000
Loss from fire	8000
Loss on sale of equipment (pretax)	2000
Income tax	15300
Total expenses		147300
Net income		$35700
Components of Income		EPS
EPS		5.10

3. Prepare a 2019 statement of comprehensive income.

OPGENORTH COMPANY
Statement of Comprehensive Income
For Year Ended December 31, 2019
Net income	$35700
Other comprehensive loss
Unrealized decrease in fair value of available for sale securities	-1800
Comprehensive income	$33900

Answer 2

net income + the unrealized = comprehensive income