Accounting for retail operations:

Problem 4-5 Single-Step Income Statement

Selected accounts and related amounts for Prescott Inc. for the fiscal year ended September 30,20Y8, are presented in Problem 4-4 (see screen shots included in problem)

Instructions:

1. Prepare a single-step income statement fin the format shown in exhibit 8.

2. Prepare a statement of stockholders' equity. No common stock was issued during the year.

166 Chapter 4 Accounting for Retail Operations Exhibit 8 Single-Step Income Statement for Retail Company TechSource Income Statement For the Year Ended December 31, 20Y7 Revenues: $708,255 600 $708,855 Expenses: $520,305 70,820 34,890 2440 Cost of goods sold 455) 80,400 P4-4 Multiple-step income statement and report of sheet The following selected accounts and their current balances appear in the ledger of Prescott Inc. for the fiscal year ended September 30, 20Y8: Cash Accounts Receivable Inventory Estimated Returns Inventory Office Supplies Prepaid Insurance Office Equipment Accumulated Depreciation- form balance Obj. 7 167,000 300,000 735,000 25,000 30,000 24,000 230,400 Retained Earnings Dividends Sales Cost of Goods Sold Sales Salaries Expense Advertising Expense Depreciation Expense- $507,600 250,000 7,134,000 4,350,000 777,600 91,800 1. Net income, $1,550,000 Store Equipment Miscellaneous Selling Expense Office Salaries Expense Rent Expense Insurance Expense Depreciation Expense- 16,600 4,000 154,800 79,800 45,900 99,000 Office Equipment Store Equipment Accumulated Depreciation 1,023,000 Store Equipment Accounts Payable Customer Refunds Payable Salaries Payable Note Payable 373,400 67,000 30,200 19,200 Office Equipment Office Supplies Expense Miscellaneous Administrative 32,400 3,300 (final payment due in five years) Common Stock 108,000 30,000 Expense Interest Expense 3,800 24,000 184 Chapter 4 Accounting for Retail Operations Obj. 7 P4-5 Single-step income statement Selected accounts and related amounts for Prescott Inc. for the fiscal year ended 30, 20Y8, are presented in Problem 4-4 Instructions 1. Prepare a single-step income statement in the format shown in Exhibit 8 2. Prepare a statement of stockholders' equity. No common stock was issued during the year