{"id":22911,"date":"2018-02-20T23:50:30","date_gmt":"2018-02-20T23:50:30","guid":{"rendered":"https:\/\/writemyessayfree.com\/practice-problem-income-statement-pdf"},"modified":"2017-08-03T16:11:36","modified_gmt":"2017-08-03T16:11:36","slug":"practice-problem-income-statement-pdf","status":"publish","type":"post","link":"https:\/\/www.benedictsol.com\/blogs\/practice-problem-income-statement-pdf\/","title":{"rendered":"Practice Problem Income Statement.pdf"},"content":{"rendered":"<div class=\"the_content_wrapper\">\n<p>Practice Problem Income Statement.pdf<\/p>\n<p>Single Step: List all revenues and subtotal<br \/> List all expenses and subtotal<br \/> Total revenues less total expenses = net income<br \/> Multi Step: Sales<\/p>\n<p>CGS<\/p>\n<p>Gross Profit<\/p>\n<p>Operating expense<\/p>\n<p>Income from operations<\/p>\n<p>Other revenues and expenses<\/p>\n<p>Income before tax expense<\/p>\n<p>Tax expense<\/p>\n<p>Income from continuing operations<\/p>\n<p>Discontinued operations<\/p>\n<p>Extraordinary items<\/p>\n<p>Net Income<\/p>\n<p>Important: Revenues are recognized when earned<br \/> Expenses are recognized when incurred<br \/> When cash is paid and received does not matter<br \/> This is accrual based accounting and follows the matching principle<\/p>\n<p>Practice Problem 1 \u2013 Income Statement \u2013 Reporting revenues and expenses<br \/> Prepaid Legal, Inc. had the following transactions occur during the month of January:<br \/> 1) Customers paid the company $600,000 for one year of legal service to be earned equally over the year.<br \/> 2) Employees worked and the company incurred $20,000 in salaries for the month of January.<br \/> 3) The company paid $15,000 for salaries to employees during January.<br \/> 4) The December utility bill of $1,350 was paid in January<br \/> 5) The January utility bill of $3,000 was received but not paid.<br \/> 6) The company purchased office furniture for $36,000 in January that is expected to be used for the next 8<br \/> years.<br \/> 7) The company incurred $1,000 of interest expense in January that won\u2019t be paid until March.<br \/> 8) Liability insurance in the amount of $4,600 to cover the next six months was paid for in January<br \/> 9) Rent for the first three months of the year was paid in January in the amount of $7,500.<br \/> 10) Supplies costing $2,000 were purchased in January and supplies costing $300 were used up in January.<br \/> Prepare a single step income statement for the month of J anuary using the accrual basis. 110 points)<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Practice Problem Income Statement.pdf Single Step: List all revenues and subtotal List all expenses and subtotal Total revenues less total expenses = net income Multi Step: Sales CGS Gross Profit Operating expense Income from operations Other revenues and expenses Income <a href=\"https:\/\/www.benedictsol.com\/blogs\/practice-problem-income-statement-pdf\/\" class=\"read-more\">Read More &#8230;<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-22911","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/22911","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/comments?post=22911"}],"version-history":[{"count":0,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/22911\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/media?parent=22911"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/categories?post=22911"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/tags?post=22911"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}