Multi-step Income Statement

A multi-step income statement shows important sub-totals on its way to Net Income.

Concept: Multi-step Income Statement

10m

Example: Multi-step Income Statement

8m

Multi-step Income Statement Additional Practice Problems

Consider the following information provided in no particular order:

What is the dollar amount of the operating income?

a. $36,000

b. $15,000

c. $17,000

d. $205,000

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Which of the following is a peripheral transaction?

a. income tax expense

b. interest expense

c. general and administrative expenses

d. depreciation expense

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Consider the following totals:

What was the total of operating income?

a. $42,000

b. $55,000

c. $60,000

d. $37,000

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The following information was taken from the accounting records of ABC Company for the year ended December 31, 2006:

Calculate the amount of  gross profit earned by ABC Company during 2006.

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The following information was taken from the accounting records of ABC Company for the period ended January 31, 2003:

Calculate the gross profit for the month of January.

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Which of the following would be considered an operating expenses on an income statement?

a. Bad debt expense, depreciation expense, sales discounts

b. Rent expense, accumulated depreciation, interest expense

c. Salaries expense, bad debt expense, freight in

d. Bad debt expense, utilities expense, depreciation expense

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By treating sales returns and allowances, sales discounts, and credit card discounts as contra- revenues, we have the following impact

a. Gross profit is reduced by sales returns and allowances, sales discounts and credit card discounts

b. Gross profit is increased by sales returns and allowances, sales discounts and credit card discounts

c. Gross profit is unchanged by sales returns and allowances, sales discounts and credit card discounts

d. Net income is increased by sales returns and allowances, sales discounts and credit card discounts

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