1st Edition

ISBN: 9780132162302

Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella

Publisher: PEARSON

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Textbook Question

Chapter 5, Problem 5.2P

Condensed Income Statement. Using the information from P5-1, prepare a condensed, multiple-step income statement with all supporting disclosures.

P5-1. Multiple-Step and Single-Step income Statement, from its current-year trial balance

Bluebird Products, Inc. Trial Balance (Partial) For the Year Ended December 31
Account	Debit	Credit
Common Stock (no par)—Beginning Balance		51,456,000
Retained Earnings—Beginning Balance		3,200,950
Accumulated Other Comprehensive Income Beginning Balance		95,675
Dividends	$ 76,500
Sales		2,200,000
Interest Income		34,500
Dividend Income		12,300
Gain on Disposal of Plant Assets		100,500
Unrealized Gain on Trading Securities		86,000
Unrealized Gain on Available-for-Sale Bonds		45,600
Cost of Goods Sold	750,000
Selling Expenses	20,000
Office Supplies Expense	123,500
Sales Salaries Expense	55.000
Advertising Expense	68,900
Office Salaries Expense	78,500
Accounting and Legal Fees—General	10,425
Systems Consulting Fees—General	44,550
Depreciation Expense—General	68,000
Amortization Expense—General	34,500
Interest Expense	23,750
Loss on Discontinued Operations—Before Tax	90,000
Loss on Asset Impairment	12,350

Required

a. Prepare a single-step income statement (or the year ended December 31 The tax rate is 40%.
b. Prepare a multiple-step income statement for the year ended December 31.

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Chapter 5, Problem 5.1P

Chapter 5, Problem 5.3P

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Presented below is the trial balance of Sandhill Corporation at December 31, 2020. Debit Credit Cash $289,100 Sales Revenue $11,907,000 Debt Investments (trading) (at cost, $218,000) 225,400 Cost of Goods Sold 7,056,000 Debt Investments (long-term) 439,040 Equity Investments (long-term) 407,680 Notes Payable (short-term) 132,300 Accounts Payable 668,360 Selling Expenses 2,940,000 Investment Revenue 93,100 Land 382,200 Buildings 1,528,800 Dividends Payable 199,920 Accrued Liabilities 141,120 Accounts Receivable 638,960 Accumulated Depreciation–Buildings 223,440 Allowance for Doubtful Accounts 37,240 Administrative Expenses 1,323,000 Interest Expense 310,660 Inventory 877,100 Gain 117,600 Notes Payable (long-term) 1,323,000 Equipment 882,000 Bonds Payable 1,470,000 Accumulated Depreciation–Equipment 88,200 Franchises 235,200 Common Stock ($5 par) 1,470,000 Treasury Stock 281,260 Patents 287,140 Retained Earnings 114,660 Paid-in Capital in Excess of Par 117,600 Totals $18,103,540 Debit…

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Chapter 5 Solutions

Intermediate Accounting

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Solution Summary: The author explains the purpose of the condensed income statement, which is a financial statement describing the company's net income.

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