(Multiple-step and Single-step) Two accountants for the firm of Elwes and Wright are arguing about the merits of presenting an income statement in a multiple-step versus a single-step format. The discussion involves the following 2004 information related to P. Bride Company ($000 omitted).

Instructions

(a) Prepare an income statement for the year 2004 using the multiple-step form. Common shares outstanding for 2004 total 40,550 (000 omitted).

(b) Prepare an income statement for the year 2004 using the single-step form.

(c) Which one do you prefer? Discuss.

Transcribed Image Text:

Administrative expense Officers' salaries Depreciation of office furniture and equipment Cost of goods sold $ 4,900 3,960 60,570 Rental revenue 17,230 Selling expense Transportation-out 2,690 Sales commissions 7,980 Depreciation of sales equipment 6,480 Sales 96,500 Income tax 9,070 Interest expense 1,860