the statement of income example is what the question asks the answer to look like
May 1 3 4 7 15.5A (LO 2, 3, 4) Eagle Hardware Store Ltd. completed the following merchandising transactions in the month of May 2021. At the beginning of May, Eagle's ledger showed Cash $7,000; Accounts Receiv- able $1,500; Inventory $3,500; Common Shares $8,000; and Retained Earnings $4,000. Eagle Hardware has experienced a return rate of 2% of sales and uses a perpetual inventory system. Purchased merchandise on account from Depot Wholesale Supply Ltd. for $5,800, terms 1/10, n/30, FOB shipping point. Freight charges of $145 were paid by the appropriate party on the merchandise purchased on May 1. Sold merchandise on account to Shep Ltd. for $3,500, terms n/30, FOB destination. The cost of the merchandise was $2,100. Freight charges of $90 were paid by the appropriate party on the May 4 sale. Received a $200 credit from Depot Wholesale Supply when merchandise was returned. Paid Depot Wholesale Supply in full. Purchased supplies for $400 cash. Received payment in full from Shep Ltd. for merchandise sold on account on May 4. 15 Collected $1,000 of the accounts receivable outstanding at the beginning of the month. All accounts were originally sold on terms of n/30. 18 Purchased merchandise from Harlow Distributors Inc. for $2,000, terms n/30, FOB destination 21 Freight of $50 was paid by the appropriate party on the May 18 purchase of merchandise. 22 Sold merchandise to various customers for $6,500 cash. The cost of the merchandise was $3,900. 29 Paid a $100 cash refund to customers for returned merchandise. The cost of the returned merchandise was $60. It was restored to inventory. 31 A physical inventory count was taken and determined that there was $5,100 of inventory on hand. Prepare any adjustment required. 8 9 11 14 Instructions a. Record the May transactions, b. Set up T accounts, enter the opening balances, and post the transactions recorded in part (a). c. Prepare a partial multiple-step statement of income for the month ended May 31, through to gross profit. d. Prepare the current assets section of the statement of financial position as at May 31. PW Technologies Inc. Statement of Income Year Ended December 31, 2021 $460,000 $ 36,000 320,000 356,000 40,000 316,000 144,000 Sales Cost of goods sold Inventory, January 1 Purchases $325,000 Less: Purchase returns and allowances 10,400 Purchase discounts 6,800 Net purchases 307,800 Add: Freight in 12,200 Cost of goods purchased Cost of goods available for sale Inventory, December 31 Cost of goods sold Gross profit Operating expenses locales Salaries expense Rent expense Utilities expense Advertising expense Depreciation expense Freight out Insurance expense Loss on disposal Income from operations Other income and expenses Interest income Interest expense Income before income tax Income tax expense Net income $ 45,000 19,000 17,000 16,000 8,000 7,000 2,000 200 114,200 29,800 $ 3,400 1,600 1,800 31,600 6,300 $ 25,300 P2A, 5A (For 5A - Do a detailed build-up of the Cost of Goods Sold section like illustration 5A.5 for PW Technologies Inc. on page 5-32) 13 12A 14A
