Use the following information to answer the questions below.

CATERPILLAR INC. Statement of Income for a Recent Year

Total sales and revenues ...................................................................................... $55,184,000

Less: Cost of products sold ................................................................................... $40,391,000

Gross profit .......................................................................................,.................... $ 14,793,000

Less: Operating costs :

Selling, general, and administrative expenses ................................................ $ 5,697,000

Research and development expenses ............................................................ $2,135,000

Other operating expenses ............................................................................... $1,633,000

Total operating costs ............................................................................................. $ 9,465,000

Operating profit ..................................................................................................... $ 5,328,000

Less: Other expenses ............................................................................................ 245,000

Consolidated profit before taxes .......................................................................... $ 5,083,000

Provision for income taxes .................................................................................... 1,380,000

Profit of consolidated companies ......................................................................... $ 3,703,000

WAL-MART STORES, INC.

Statement of Income for a Recent Year Value

Total revenues ....................................................................................................... $485,651,000

Less: Cost of sales .................................................................................................$365,086,000

Gross profit ............................................................................................................ $120,565,000

Less: Operating, selling, general. and administrative expenses ......................... 93,418,000

Operating income ................................................................................................. $ 27,147,000

Less: Interest expense, net ................................................................................... 2,348,000

Income from continuing operations before income taxes ................................... $ 24,799,000

Provision for income taxes .................................................................................... (7 ,985,000)

Income from discontinued operations, net of tax ................................................ 285,000

Consolidated net income ...................................................................................... $ 17,099,000

SOUTHWEST AIRLINES CO.

Statement of Income for a Recent Year

Operating revenue:

Passenger ......................................................................................................... $ 17,658,000

Freight ............................................................................................................... 175,000

Other ................................................................................................................. 772,000

Total operating revenue ................................................................................... $ 18,605,000

Less: Operating expenses:

Salaries, wages, and benefits .......................................................................... $ 5,434,000

Fuel and oil ....................................................................................................... 5,293,000

Maintenance materials and repairs ................................................................. 978,000

Aircraft rentals ................................................................................................... 295,000

Landing fees and other rentals ........................................................................ 1,111,000

Depreciation and amortization ......................................................................... 938,000

Acquisition and integration .............................................................................. 126,000 .

Other operating expenses ............................................................................... 2,205,000

Total operating expenses ................................................................................. $ 16,380,000

Operating income ................................................................................................. $ 2,225,000

Other expenses (income):

Interest expense ............................................................................................... $ 130,000

Capitalized interest ........................................................................................... (23,000)

Interest income ................................................................................................. (7,000)

Other (gains) losses, net ' 309,000

Total other expenses (income) ......................................................................... $ 409,000

Income before income taxes ................................................................................ $ 1,816,000

Provision for income taxes .................................................................................... 680,000

Net income ............................................................................................................ $ 1, 136,000

ANSWER THESE QUESTIONS USING THE ABOVE INFORMATION:

1. List the major differences between the income statements shown for Catepillar Inc., Walmart and Southwest

2. Explain how cost-accounting data were used to prepare these income statements.

3. On the income statement for where would the ticket agents' salaries be shown? Where would the costs of the computer equipment used to keep track of reservations be included on the statement?

4. On the income statement for where would the cost of newspaper advertising be shown? How about the cost of merchandise?

5. Where would the salary of the brand manager who plans advertising for equipment be shown? How about the salary of a production employee? Where would the cost of the raw materials used in the company's products be included on the statement?