Question

Slapshot Company makes ice hockey sticks and sold 1,700 sticks during the month of June at a total cost of $408,000. Each stick sold at a price of $400. Slapshot also incurred two types of selling costs: commissions equal to 10% of the sales price and other selling expense of $63,100. Administrative expense totaled $53,800.

Required:

Prepare an income statement for Slapshot for the month of June. Refer to the list below for the exact wording of labels or amount descriptions on the income statement. Labels Add For the Month of June June 30 Less Selling expenses Amount Descriptions Administrative expenses Commissions Cost of goods manufactured Cost of goods sold Fixed selling expenses Gross margin Operating income Operating loss Purchases Sales revenue Total selling expenses Prepare an income statement for Slapshot for the month of June. Refer to the list of Labels and Amount Descriptions for the exact wording of text entries on the income statement. Be sure to complete the statement heading. Slapshot Company Income Statement 1 2 3 4 5 6 7 8 9

Answer 1

SLAPSHOT COMPANY
INCOME STATEMENT
FOR THE MONTH ENDING JUNE 2020
PARTICULARS	AMOUNT	REMARKS
SALES REVENUE	$            6,80,000.00	:1700*$400
LESS: COST OF GOODS SOLD	$            4,08,000.00	:GIVEN
GROSS MARGIN	$            2,72,000.00	: SALES REVENUE- COST OF GOODS SOLD
ADMINISTRATIVE EXPENSES:
VARIABLE	$                53,800.00	: GIVEN
SELLING EXPENSES:
VARIABLE:
COMMISSIONS	$                68,000.00	:10% OF 680000
FIXED:
OTHER SELLING EXPENSES	$                63,100.00	: GIVEN
OPERATING INCOME	$                87,100.00	: SALES REVENUE-ADMINISTRATIVE EXPENSES-SELLING EXPENSE
LESS: OTHER INCOME & EXPENSES
INTEREST EXPENSES	$                               -
INTEREST REVENUE	$                               -
INCOME BEFORE TAX	$                87,100.00