Preparation of single step and multi step income statement

Reference no: EM1319596

The accountant of Whitney Houston Shoe Co. has compiled the following information from the company's records as a basis for an income statement for the year ended December 31, 2007.

Rental revenue	$29,000
Interest on notes payable	18,000
Market appreciation on land above cost	31,000
Wages and salaries-sales	114,800
Materials and supplies-sales	17,600
Income tax	37,400
Wages and salaries-administrative	135,900
Other administrative expenses	51,700
Cost of goods sold	496,000
Net sales	980,000
Depreciation on plant assets (70% selling, 30% administrative)	65,000
Cash dividends declared	16,000

There were 20,000 shares of common stock outstanding during the year.

Instructions:

a) Prepare a multiple-step income statement.
b) Prepare a single-step income statement.
c) What format do you prefer? Discuss.

Reference no: EM1319596

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