Question

2018 Income Statement

Revenues:

Gross sales:                                                     $2,700,000

Dividends:                                                     $10,000

Bank account interest:                                    $350

Interest on U.S. Treasury Bonds:                   $420

Santa Clara County, CA bond interest:          $180

Cost of Goods Sold
Inventory as of 1/1/18 of        $100,000

Inventory purchased during 2018: $283,487

Inventory as of 12/31/18 of    $220,000

[Note: All inventory figures are valued based on original cost and using the specific identification method (i.e., neither FIFO nor LIFO); IRC Sect. 263A (UNICAP) does not apply to the corporation; there were no changes in the method of valuing inventories; and there were no write downs of subnormal goods in 2018.]

Other Expenses
Store rent:                                           $36,000
Advertising Services:                         $59,438
Office Supplies:                                  $ 8,732

Repairs and maintenance:                  $ 7,240

Depreciation:                                     $ 2,100

Entertainment:                                    $6,000
Employee meals:        
(while on business trips):                    $1,400
Travel:                                                $7,800
Charitable Contributions :                  $9,500

Mortgage Interest Expense:                $500

Wages (Noriko):                                 $120,000

Wages (Jeff): $92,000
Wages (other employees): $108,888

Federal Payroll Taxes: $8,330

Sales Tax Expense: $243,000
Fines and Penalties:    $5,700
Outside Lobbying Expenses: $23,300

Other Income (Expense)
Loss on sale of Debt Investments :     $500

Gain on the Sale of Business Assets :$650

Gain on the exchange of real property: $260,000

Net Income: [must calculate]

Thank you!

Answer 1

2018 Income Statement Particulars Workings Amount ($) Revenues: Gross sales 2700000.00 Dividends 10000.00 Bank account interest 350.00 Interest on U.S. Treasury Bonds 420.00 Santa Clara County, CA bond interest 180.00 Other Incomes / (Loss) Loss on sale of Debt Investments -500.00 Gain on the sale of Business Assets 650.00 Gain on the exchange of real property 260000.00 Total A 2971100.00 Other Expenses Store rent 36000.00 Advertising Services 59438.00 Office Supplies 8732.00 Repairs and maintenance 7240.00 Depreciation 2100.00 Entertainment 6000.00 Employee meals(while on business trips) | 1400.00 Travel 7800.00 Charitable Contributions 9500.001 Mortgage Interest Expense 500.00 Wages (Noriko) 120000.00 Wages (Jeff) 92000.00 Wages (other employees) 108888.00 Federal Payroll Taxes 8330.00 Sales Tax Expense 243000.00 Fines and Penalties 5700.00 Outside Lobbying Expenses 23300.00 Cost of Goods Sold Inventory as of 1/1/18 100000 Add-Inventory purchased during 2018 283487 Less-Inventory as of 12/31/18 22000 361487.00 Total B 1101415.00 2018 Income Statement (Total A-Total B) 1869685.00