90.2K

Verified Solution

Link Copied!

The following information applies to the questions displayed below.]

Psymon Company, Inc. sells construction equipment. The annual fiscal period ends on December 31. The following adjusted trial balance was created from the general ledger accounts on December 31:

Account Titles	Debits			Credits
Cash	$	60,940
Accounts Receivable		25,200
Inventory		92,000
Property and Equipment		68,000
Accumulated Depreciation				$	28,600
Liabilities					42,600
Common Stock					126,000
Retained Earnings, January 1					15,200
Sales Revenue					263,000
Sales Returns and Allowances		8,800
Sales Discounts		11,600
Cost of Goods Sold		141,200
Salaries and Wages Expense		24,200
Office Expense		25,200
Interest Expenses		3,800
Income Tax Expense		14,460
Totals	$	475,400		$	475,400

6.

Required information

Required:

1.	Prepare a multistep income statement that would be used for internal reporting purposes. Treat Sales Discounts and Sales Returns and Allowances as contra-revenue accounts. TIP: Some of the accounts listed will appear on the balance sheet rather than the income statement.

7.

Required information

2.	Prepare a multistep income statement that would be used for external reporting purposes, beginning with the amount for Net Sales.

8.

Required information

3.	Compute the gross profit percentage. (Round your answer to 1 decimal place.)

Answer & Explanation Solved by verified expert

See Answer