1.4.4

Question 0

Income Statement Format 1-2 (Revenues -)

Answer 0

(1)Revenues- Cost of Goods Sold= (2) Gross Profit

Question 1

3 steps Preparing Financial Statements

Answer 1

1) Prepare Income Statement
2) Use Net Income update Retained Earnings & prepare Balance Sheet
3) Complete Statement of Cash Flows & Statement Stockholders’ Equity

Question 2

Income Statement Format 2-3

Gross Pofit-

Answer 2

(2) Gross Profit - Operating (selling, general & administrative) Expense=
(3) Operating Income

Question 3

Income Statement Format 3-4 (Operating Income-)

Answer 3

(3) Operating Income - Interest (+-), Gains & Losses = (4) Pre-Tax Income

Question 4

Income Statement Format 4-5 (Pre-Tax Income-)

Answer 4

(4) Pre-Tax Income - Income Tax Expense =

Net Income

Question 5

Entire Income Statement Format

Answer 5

1. Revenues- Cost of Goods Sold=
2. Gross Profit - Operating (selling, general & administrative) Expense=
3. Operating Income - Interest (+-), Gains & Losses =
4. Pre-Tax Income - Income Tax Expense =
5. Net Income