Bb.39. Assume the marketing department has presented a plan to increase advertising expenses by $320 million. It expects this plan toresult in an increase in both net sales and cost of goods sold of 25%. Assume a tax rate of 20%. (Hint: Increase both sales revenueand sales returns and allowances by 25%)Prepare a multiple-step income statement. (Round answers to 0 decimal places, e.g. 15,222.)Salaries and wages expensesDepreciation expenseSales revenueInterest expenseAdvertising expenseSales returns and allowancesSuppose in its income statement for the year ended June 30, 2022, The Clorox Company reported the following condensed data(dollars in millions).$440885,504153479THE CLOROX COMPANYIncome Statement284(amounts in millions)#Research and development expense $107Income tax expenseLoss on disposal of plant assetsCost of goods soldRent expenseUtilities expense269453,00010056

Income statement represents the net income or net loss that is calculated by deducting the expenses…

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Business

Accounting

Prepare a multiple-step income statement.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Assume the marketing department has presented a plan to increase advertising expenses by $340 million. It expects this plan to result in an increase in both net sales and cost of goods sold of 25%. (Hint: Increase both sales revenue and sales returns and allowances by 25%.) Redo parts (a) and (b) and discuss whether this plan has merit. (Assume a tax rate of 34%, and round all amounts to whole dollars.)Prepare a multiple-step income statement. (Round answers to 0 decimal places, e.g. 15,222.)
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