Question

(5-4) The adjusted trial balance for the year ended December 31, 2022, for Dykstra, Company is shown below. Prepare a multiple-step income statement. Dykstra Company Adjusted Trial Balance For the Year Ended December 31, 2022 Debit Credit Cash $ 14,500 Accounts Receivable 11,100 Inventory 29,000 Prepaid Insurance 2,500 Equipment 95,000 Accumulated Depreciation Equipment $ 18,000 Notes Payable 25,000 Accounts Payable 10,600 Common Stock 70,000 Retained Earnings 11,000 Dividends 12,000 Sales Revenue 536,800 Sales Returns and Allowances 6,700 Sales Discounts 5,000 Cost of Goods Sold 363,400 Freight-Out 7,600 Advertising Expense 12,000 Salaries and Wages Expense 56,000 Utilities Expense 18,000 Rent Expense 24,000 Depreciation Expense 9,000 Insurance Expense 4,500 Interest Expense 3,600 Interest Revenue 2,500 $673,900 $673,900 Instructions Prepare a multiple-step income statement for Dykstra Company. Assume a tax rate of 30%.

And if possible, explain how you get those numbers if it requires more math. thank you.

Answer 1

Sales revenue	536,800
Sales returns and allowances	-6,700
Sales discount	-5,000
Net sales		525,100
Cost of goods sold		-363,400
Gross Profit		161,700
Operating expense:
Freight out	-7,600
Advertisement expense	-12,000
Salaries and wages expense	-56,000
Utilities expense	-18,000
Rent expense	-24,000
Depreciation expense	-9,000
Insurance expense	-4,500
Total Operating Expenses		-131,100
Operating Profit		30,600
Other revenues:
Interest revenue		2,500
Other expenses:
Interest expense		-3,600
Profit before tax		29,500
Income tax expense ((29,500 x 30%)		-8,850
Net Income		$20,650

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