Cost of Goods Sold, Income Statement, and Statement of Comprehensive Income Gaskin Company derives the following items from its adjusted trial balance as of December 31, 2019: Sales Interest revenue $142,000 5,200 Purchases returns Purchases discounts taken $3,300 2,700 12,500 89,700 3,800 Inventory, January 1, 2019 3,400 Purchases Gain on sale of equipment (pretax) Freight-in Selling expenses Unrealized increase in fair value of available-for-sale securities 15,600 Administrative expenses 24,500 Loss from truck accident (pretax) 6,500 2,400 The following additional information is also available. 1. The December 31, 2019, ending inventory is $14,700. 2. During 2019, 4,200 shares of common stock were outstanding the entire year. 3. The income tax rate is 30% on all items of income. Required: 1. Prepare a separate schedule for Gaskin's cost of goods sold. GASKIN COMPANY Schedule 1: Cost of Goods Sold For Year Ended December 31, 2019 Inventory, 1/1/2019 12,800 Purchases $ 89,700 Add: Freight-in 3.400 Add: Freight-in 3,400 Cost of purchases 93,100 Less: Purchases returns 5,200 Add: Purchases discounts taken x 2,700 Net purchases 85,200 Cost of goods available for sale 98,000 X Less: Inventory, 12/31/2019 14,700 Cost of goods sold 83,300X Feedback 2. Prepare a 2019 single-step income statement. Disregard EPS disclosure. GASKIN COMPANY Income Statement (Single-Step) For Year Ended December 31, 2019 Revenues Sales 142,000 Interest revenue 3,300 Gain on sale of equipment 3,800 Total revenues $ 149,100 Expenses Cost of goods sold 85,500 X Selling expenses 15,600 Administrative expenses 24,200 Loss from truck accident 6,500 Income tax expense 5,850 Total expenses 135,450 Net income 13,650 Feedback Check My Work Under the single-step income statement format, a company classifies its item into two groups, revenues and expenses. The company computes its income from continuing operations in a single step as the difference between the totals of the two groups. Example of a single-step income statement: Banner Corporation Income Statement For the Year Ended December 31, 2013 GASKIN COMPANY Income Statement (Multi-Step) For Year Ended December 31, 2019 Sales 142,000 Cost of goods sold 3,300 X Gross profit 3,800 X Operating expenses Selling expenses 15,600 Administrative expenses 24,200 x Total operating expenses 39,800 Operating income 18,900 Other items Gain on sale of equipment 3,800 Loss from truck accident 6,500 Interest revenue 3,300 600 Income before income tax 19,500 Income tax expense 5,850 Feedback 4. Prepare a 2019 statement of comprehensive income. GASKIN COMPANY Statement of Comprehensive Income For Year Ended December 31, 2019