
Compute the missing values of the income statement under different cases.

Answer to Problem 10E
Preparation of income statement and computation of missing amounts as given below:
Company N | |||||
Statement of Income | |||||
For the year ended | |||||
Particulars | Amount | ||||
Case A | Case B | Case C | Case D | Case E | |
Sales revenue | $800 | $600 | $500 | (12) $1,170 | (14) $760 |
Less: Cost of Goods sold | (1) $425 | ($150) | (9) $280 | $500 | $320 |
Gross margin | $375 | (4) $450 | (8) $220 | (11) $670 | $440 |
Less: Administrative expense | $125 | (5) $100 | $70 | $120 | $80 |
Less: Selling expense | (2) $50 | $50 | $80 | $350 | $240 |
Pretax income | $200 | $300 | (7) $70 | $200 | (13) $120 |
Less: Income tax expense | (3) $50 | $30 | $20 | $50 | $20 |
Net income | $150 | (6) $270 | $50 | (10) $150 | $100 |
Table (1)
Explanation of Solution
Financial statement: Financial statements are condensed summary of transactions communicated in the form of reports for the purpose of decision making. The financial statements show the financial status of the business. The financial statements consist of the
Income statement: Income statement is a financial statement that shows the net income or net loss by deducting the expenses from the revenues and vice versa.
Working Note:
Determine the amount of cost of goods sold.
Determine the amount of selling expense.
Determine the amount of income tax expense.
Determine the amount of gross margin.
Determine the amount of administrative expense.
Determine the amount of net income.
Determine the amount of pretax income.
Determine the amount of gross margin.
Determine the amount of cost of goods sold.
Determine the amount of net income.
Determine the amount of gross margin.
Determine the amount of sales revenue.
Determine the amount of pretax income.
Determine the amount of sales revenue.
Want to see more full solutions like this?
Chapter 5 Solutions
FINANCIAL ACCOUNTING (LL)-W/CONNECT
- Off-set the losses for the appropriate years using the rules as applied in Trinidad and Tobago and those in Jamaica: XYZ Company Limited in year of assessment 2015 makes net income of $8,000,000 and its PYL was $9,000,000. XZY registered in December 2014 for GCT/VAT and declared that its estimated income for the year of assessment 2015 as $2,999,000.arrow_forwardTimberline Services Company, a division of a major energy company, provides various services to the operators in the Rocky Mountain oil fields. For the most recent year, the company reported sales of $22,500,000, net operating income of $7,500,000, and average operating assets of $40,000,000. What is the margin for Timberline Services Company? Accountingarrow_forwardI need correct answer of this general accounting questionarrow_forward
- Please solve this question general accountingarrow_forwardWhat is the level of its accounts receivable on these general accounting question?arrow_forwardFor the following scenarios, off-set the losses for the appropriate years using the rules as applied in Trinidad and Tobago and those in Jamaica: In the year of assessment 2012, Company McKenzie Incor. Ltd has PYL of $3,800,000 to its disposal. In 2013 the company made net income of $4,700,000 and 3,800,000 in 2014.arrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education





