The following adjusted trial balance for Bell Servicing was prepared at the end of the fiscal year, December $31,2023$:

 

 

 

 

 Account Debit Credit 

 

$101$ Cash $ $7,300$ 

 

$119$ Merchandise inventory $15,500$ 

 

$125$ Supplies $9,300$ 

 

$128$ Prepaid insurance $3,300$ 

 

$165$ Store equipment $50,300$ 

 

$166$ Accumulated depreciation, store equipment $ $46,100$ 

 

$167$ Office equipment $68,300$ 

 

$168$ Accumulated depreciation, office equipment $33,500$ 

 

$201$ Accounts payable $15,300$ 

 

$301$ Jonah Bell, capital $25,080$ 

 

$302$ Jonah Bell, withdrawals $40,300$ 

 

$413$ Sales $284,800$ 

 

$415$ Sales discounts $1,300$ 

 

$505$ Cost of goods sold $74,100$ 

 

$612$ Depreciation expense, store equipment $4,500$ 

 

$613$ Depreciation expense, office equipment $3,100$ 

 

$622$ Sales salaries expense $45,300$ 

 

$623$ Office salaries expense $31,300$ 

 

$637$ Insurance expense, store $1,300$ 

 

$638$ Insurance expense, office $1,250$ 

 

$640$ Rent expense, office space $12,300$ 

 

$641$ Rent expense, selling space $16,300$ 

 

$651$ Office supplies expense $1,130$ 

 

$652$ Store supplies expense $1,700$ 

 

$655$ Advertising expense $16,900$ 

 

 Totals $ $404,780$ $ $404,780$ 

 

 

Required:

 

$1.$ Prepare a classified multiple$-$step income statement that would be used by the businesss owner.

 

 

 

 

$2.$ Prepare a multiple$-$step income statement that would be used by external users.

 

 

 

 

$3.$ Prepare a single$-$step income statement that would be provided to decision makers outside the company.

 

 

 

 

Analysis Component:

 

If you were a decision maker external to Bell Servicing, which income statement format would you prefer and why, if you had a choice?

 

 

 

 

Which income statement format$($s$)$ could you expect as an external user?