Question

Brief Exercise 4-1 (Algo) Single-step income statement (L04-1) 

The adjusted trial balance of Pacific Scientific Corporation on December 31, 2021. the end of the company's fiscal year, contained the following income statement items ($ in millions): sales revenue, $2,170; cost of goods sold, $1,380: selling expense, $185. general and administrative expense. $175; interest expense, $50, and gain on sale of investments, $80. Income tax expense has not yet been recorded. The income tax rate is 25%. 

Prepare a single step income statement for 2021. 

Answer 1

PACIFIC SCIENTIFIC CORPORATION

Income statement

For the year ended December 31,2021

Revenues and gains
Sales revenue	2170
Gain on sale of investment	80
Total revenue and gains		2250
Expenses and losses
Cost of goods sold	1380
Selling expense	185
General and administrative expense	175
Interest expense	50
Total expense and losses		1790
Income before income taxes		460
Income tax expense		115
Net income		345