EXERCISE 4.5 (30-35 minutes) (a)Multiple-Step Form P. BRIDE COMPANY Income Statement For the Year Ended December 31, 2020 (In thousands, except earnings per share) Sales revenue......................................................$96,500 Cost of goods sold.............................................60,570 Gross profit.........................................................35,930 Operating Expenses: Selling expenses Sales commissions.................................$7,980 Depr. of sales equipment........................6,480 Delivery expense.....................................2,690$17,150 Administrative expenses Officers' salaries.....................................4,900 Depr. of office furn. and equip...............3,9608,86026,010 Income from operations...................9,920 Other Revenues and Gains: Rent revenue.................................................17,230 Other Expenses and Losses: Interest expense............................................1,860 Income before income tax..................................25,290 Income tax.....................................................9,070 Net income...........................................................$16,220 Earnings per share ($16,220 ÷ 40,550)..............$.40
EXERCISE 4.5 (Continued) (b)Single-Step Form P. BRIDE COMPANY Income Statement For the Year Ended December 31, 2020 (In thousands, except earnings per share) Revenues Net sales.............................................................................$96,500 Rental revenue...................................................................17,230 Total revenues..............................................................113,730 Expenses Cost of goods sold............................................................60,570 Selling expenses................................................................17,150 Administrative expenses...................................................8,860 Interest expense.................................................................1,860 Total expenses.............................................................88,440 Income before income tax.......................................................25,290 Income tax................................................................................9,070 Net income.........................................................................$16,220 Earnings per share..................................................................$.40
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