Question

Presented below are some of the account balances for Sofa So Good Company.
	DEBITS	CREDITS
Retained Earnings, January 1, 2020		1,000
Sales Revenue		10,000
Cost of goods sold	4,000
Interest revenue		40
Salary and wage expense	1,200
Rent expense	1,000
Insurance expense	300
Depreciation expense	200
Supplies expense	100
Write off of Goodwill	400
Gain in sale of investments		500
Loss due to meteor strike	300
Loss on sale of discontinued plastic bag division (pretax)	700
Loss on operations of discontinued plastic bag division (pretax)	400
Dividends declared on preferred stock	200
Dividends declared on common stock	100
Income tax rate	30%
Number of common shares authorized, issued and outstanding		100
INSTRUCTIONS:
Prepare a multi-step income statement in proper format for the year ended December 31, 2020.

Answer 1