ats payable ats receivabl cising expens - stock good
![**The following information was taken from the accounts of Green Market, a small grocery store, at December 31, Year 2. The accounts are listed in alphabetical order, and all have normal balances. Dollar amounts are given in thousands.**
- Accounts payable: $610
- Accounts receivable: 410
- Advertising expense: 200
- Cash: 420
- Common stock: 210
- Cost of goods sold: 700
- Interest expense: 60
- Merchandise inventory: 350
- Prepaid rent: 50
- Retained earnings, 1/1/Year 2: 645
- Sales revenue: 1,100
- Salaries expense: 230
- Rent expense: 100
- Gain on sale of land: 45
**Required**
Prepare an income statement for the year using the single-step and multistep approach.
**Complete this question by entering your answers in the tabs below.**
- Single Step
- Multistep
**Prepare an income statement for the year using the single-step approach. (Enter values in thousands of dollars. Amounts to be deducted and losses should be indicated with a minus sign.)**
**GREEN MARKET**
**Income Statement**
**For the Year Ended December 31, Year 2**
Expenses:
- [Blank line]
- [Blank line]
- [Blank line]
- [Blank line]
- [Blank line]
Total cost and expenses:
- [Blank line]
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The blank lines under "Expenses" are for inserting various expense items to calculate total expenses. The "Total cost and expenses" line would show the sum of all expenses, which is necessary for calculating net income in the single-step approach. The income statement is a key financial document that summarizes the revenues, costs, and expenses incurred during a specific period, providing insight into a company’s profitability.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb034729f-db63-4235-9b33-79c3c77be50a%2F375ad755-2ff0-4f46-98d2-a8d8b1294999%2F23mfpq4_processed.png&w=3840&q=75)
Single step approach to Income Statement is the most simpliefied form of presenting Income Statement. It popularly used by small scale business units due to its simplicity. Here we add up total revenues for the acconting period and deduct all expenses to arrve at net ncome or net loss as the case may be. Partculary it s used by solepropretorshhps ,partnershps or S corporatons where specfiied format is not requred by law.
In multi step approach the Income Statement is prepared accoring to specified format indicating Total Revenue , Cost of Sales , Gross Profit , Operating Expenses , Operating Income , Financial Exps , Net Income before tax , Income Tax , Net Profit. Generally it is followed by medium and large businesses .
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