Question

Ch 16. Q 2

Prepare an income statement for Hansen Realty for the year ended December 31, 2017. Beginning inventory was $1,263. Ending inventory was $1,615. (Input all amounts as positive values.)

Sales	$	36,400
Sales returns and allowances		1,107
Sales discount		1,167
Purchases		11,262
Purchase discounts		555
Depreciation expense		130
Salary expense		5,950
Insurance expense		3,350
Utilities expense		225
Plumbing expense		265
Rent expense		195

Answer 1

Income Statement:
Revenues:
Sales revenue		36400
Less: Sales return		1107
Less: Sales discount		1167
Net sales revenue			34126
Cost of goods sold:
Beginning inventory		1263
Add: Net purchase		10707
(11262-555)
Total cost of Goods		11970
Less: Ending inventory		1615	10355
Gross Profit			23771
Expense:
Depreciation			130
Salary expenses			5950
Insurance expenses			3350
utilities expense			225
Plumbing expenses			265
Rent expense			195
Net Income			13656