Question

1 Noodles Unlimited, Inc. sells swimming pool toys. The following adjusted trial balance 2 is for the year ended December 31, 20X1. Credits Debits $37,500 28,600 43,300 2,000 69,000 4 Account Titles Cash 6 Accounts Receivable 7 Inventory Prepaid Rent 9 Equipment 10 Accumulated Depreciation 11 Accounts Payable 12 Unearned Fees 13 Long-term Notes Payable 14 J. Noodle, Capital 15 Sales Revenue 16 Sales Returns and Allowances 17 Sales Discounts 18 Cost of Goods Sold 19 Salaries and Wages Expense Depreciation Expense 21 Rent Expense 22 Interest Expense Loss on Sale of Equipment Totals $20,700 8,800 20,000 75,000 31,800 175,500 4,700 6,000 67,700 25,900 13,800 24,000 1,600 7,700 $331,800 $331,800 26 Required: 27 1. Prepare a multistep income statement that would be used for internal reporting purposes. 28 Note: When more than one correct account could appear in a cell, list items in order of largest to 29 smallest dollar amounts. Use cell referencing to select account titles and values. 30 All numbers should appear as positive numbers.

Answer 1

Income Statement
Sales Revenue			$ 175,500.00
Less:
Sales Returns and Allowances			$     4,700.00
Sales Discounts			$     6,000.00
Net Sales			$ 164,800.00
Cost of Goods sold			$   67,700.00
Gross Profit			$   97,100.00
Expenses:
Salaries and Wages Expense			$   25,900.00
Depreciation Expense			$   13,800.00
Rent Expense			$   24,000.00
Income from operations			$   33,400.00
Other Expenses and Losses:
Loss on sale of equipment			$     7,700.00
Interest Expense			$     1,600.00
Net Income			$   24,100.00
Gross Profit Percentage			58.92	percent

Formula used for Net Income:

Income Statement Sales Revenue 175500 Less: Sales Returns and Allowances 4700 Sales Discounts 6000 Net Sales =C3-SUM(C5:06) Cost of Goods sold 67700 Gross Profit =C7-C8 Expenses: Salaries and Wages Expense 25900 Depreciation Expense 13800 Rent Expense 24000 Income from operations =C9-SUM(C11:013) Other Expenses and Losses: Loss on sale of equipment 7700 Interest Expense 1600 =IF(C18>0,"Net Income","Net Loss") =C14-SUM(C16:017)