The following information was taken from the accounts of Green Market, a delicatessen, at December 31, 2018. The accounts are listed in alphabetical order, and each has a normal balance. Accounts payable Accounts receivable Advertising expense Cash 615 415 200 425 Common stock 215 Cost of goods sold Interest expense Merchandise inventory Prepaid rent Retained earnings, 1/1/2018 700 55 300 55 650 Sales revenue 1,150 Salaries expense 280 Rent expense 100 Gain on sale of land 100 Required Prepare an income statement for the year using the single-step and multistep approach (Enter any losses with a minus sign.) Answer is not complete. Complete this question by entering your answers in the tabs below. Single step Multistep Prepare another income statement using the multistep approach. (Enter any losses with a minus sign.) GREEN MARKET Multistep Income Statement For the Year Ended December 31, 2018 Net sales revenue Cost of goods sold Gross margin Operating expenses 1,150 700 450 Salaries expense 280 Advertising expense 200 Rent expense 100 Total operating 580 expenses Operating income (loss) Non-operating items Gain on sale of land 100 Interest expense 55 Net income (loss) $ 280
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
The following information was taken from the accounts of Green Market, a delicatessen, at December 31, 2018. The accounts are listed in alphabetical order, and each has a normal balance.
Multistep Income Statement
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