Question

Corporation provided the following account balances as of the end of the current year. The company is subject to a 45​% income tax rate.

Requirement

Prepare a​ single-step and a​ multiple-step statement of net income for Bob Corporation.

Bob Corporation

Trial Balance (Selected Accounts)

For the Year Ended December 31

Account

Debit

Credit

Dividends

$29,000

Sales

$1,800,000

Interest Income

7,500

Dividend Income

5,800

Unrealized Gain on Trading Securities

24,000

Gain on Disposal of Plant Assets

28,000

Gain on Flood Damage-Before Tax

18,000

Gain on Discontinued Operations-Before Tax

31,000

Cost of Goods Sold

78,000

Sales Salaries Expense

34,000

Office Supplies Expense

25,000

Advertising Expense

88,000

Office Salaries Expense

25,000

Systems Consulting Fees-General

32,000

Selling Expenses

84,000

Accounting and Legal Fees-Administrative

38,000

Depreciation Expense-General

89,000

Amortization Expense-General

13,000

Interest Expense

30,000

Loss on Asset Impairment

66,000

Unrealized Loss on Available-for-Sale Bonds

7,000

Bob Corporation

Statement of Net Income

For the Year Ended December 31

Answer 1

77600 Bob Incorporation Income statement (single step for the year ended. December 31 (1) Revenus_________ _ (B) Sales ___-1800.000 Interest Exper Income 7 500 Dividend Income unrealized Gain Trade securities 24,000 Gain on Disposal of plant assets. 28,000 Gain on flood deinen 18.000 Gain on Discontinued operatioy__ 31000 - Total Revenue. A)___ __1914300 _(B) Expensy Cost of Goods sold 78.000 Dividends 29,000 Sah Salaries Exp 84,000 Office Supplies Exp 25,000 System ConsuHancy fee. 32000 Selling Expenses $4,000 Accounting & legal fee 3600D. Depreciation 89.00 Amortisation 13000. 30.000 Interest Expenses Loss on Anet Impairment 66.000 unrealized log on Bonds 7,000 525.000 - Total Expense. AB) – ------.. Net Income $(8) Beforrax _13,89,300 (625.165 len: Tar@, 45% A Net Income After Tax 764,115

1722000 84,000 25,000 Bob Incorporation Income Statment (Multi-step) for the year ended December 31 Sales 18.00.000 Cost of Goods sold 78,000) Gooss margin- Operaly Expenses Sale salaries 34,000 Selling Expenses office supplies Depreciation 89,000 Amortaziation 13.000 (245.000) -.--. Operating Income 1477,000 Other Trome & Expenss. Interest Inome Dividend Income Unrealized Grains Trab securities Gein on Disposal of plant assets. 28,000 Gain on flood dange Grain on Discontinued Operation Divédends System Consultancy fee. Accounting & legal fee. (38.600) 30,000) Fotores eos et Impariament 16 6pco) 197,700) onrealised loss on Bonds Income Befor Tax +13,89,300 Tax @ 451 (625,185 Income after Tax 164ALS 7500 5800 Quoco 18,000 311000 (29.000) (82000)