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Question:Please amswer P2-4 , from chapter2 for Financial Accounting: Tools for Business …
for Financial Accounting: Tools for Business Decision Making 7th edition by Kimmel, Weygandt and Kieso:-inthe pictures below
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Question & Answer: Question:Please amswer P2-4 , from chapter2 for Financial Accounting: Tools for Business ……..
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Additional informations
!-Mbong started the year with 25,000 of common shares and issued 8,200 more during the year
2- 1,500 of the bank loan payable is due to be repaid within the next year
instruction
(a)prepare an income statement .statement of change of equity ,and statement of financial position for the year
(b) Explain how each financial statement is related to others
Expert Answer
| BLOSSOM CORPORATION | |||
| Income Statement | |||
| for the year ended December 31,2018 | |||
| Service Revenue | $212,900 | ||
| Less : Operating Expense | $39,400 | ||
| Operating Income | $173,500 | ||
| Less : Selling and administrative expense | |||
| Repairs and Maintenance Expense | $2,300 | ||
| Depreciation Expense | $5,700 | ||
| Insurance Expense | $1,700 | ||
| Salaries Expense | $119,800 | ||
| Utilities Expense | $2,000 | ||
| Supplies Expense | $1,000 | ||
| Total Selling and administrative expenses | $132,500 | ||
| Add : Other Income – Interest Revenue | $500 | ||
| Earnings before interest and tax | $41,500 | ||
| Less : Interest Expense | $1,500 | ||
| Profit before Tax | $40,000 | ||
| Less : Income Tax Expense | $6,000 | ||
| Net Income | $34,000 | ||
