An income statement is a summary of a company’s revenues and costs over a given period time. The data in the file bellevuebakery is an example of an income statement. It contains the revenues and costs for last year for Bellevue Bakery.

Revenues include gross sales and other income. Costs include returns, cost of goods sold, advertising, salaries/wages, other operating expenses, and taxes. In the income statement there are intermediate calculations defined as follows.

a. Create a waterfall chart of the income statement for Bellevue Bakery. In this waterfall chart, for each intermediate calculation “set as total.”

b. Create another waterfall chart of the income statement for Bellevue Bakery, but do not include any of the entries corresponding to intermediate calculations except Net Income which you should “set as total.”

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Net Sales Gross Profit Gross Sales - Returns Net Sales - Other Income - Cost of Goods Sold Net Income Before Taxes = Gross Profit - Advertising - Salaries/Wages - Other Operating Expenses Net Income Net Income Before Taxes - Taxes