Question

Multiple-Step Income Statement and balance sheet

The following selected accounts and their current balances appear in the ledger of Kanpur Co. for the fiscal year ended June 30, 2019:

Cash	$92,000		Gerri Faber, Drawing	$300,000
Accounts Receivable	450,000		Sales	8,925,000
Merchandise Inventory	370,000		Cost of Merchandise Sold	5,620,000
Estimated Returns Inventory	5,000		Sales Salaries Expense	850,000
Office Supplies	10,000		Advertising Expense	420,000
Prepaid Insurance	12,000		Depreciation Expense—Store Equipment	33,000
Office Equipment	220,000		Miscellaneous Selling Expense	18,000
Accumulated Depreciation—Office Equipment	58,000		Office Salaries Expense	540,000
Store Equipment	650,000		Rent Expense	48,000
Accumulated Depreciation—Store Equipment	87,500		Insurance Expense	24,000
Accounts Payable	38,500		Depreciation Expense—Office Equipment	10,000
Customer Refunds Payable	10,000		Office Supplies Expense	4,000
Salaries Payable	4,000		Miscellaneous Administrative Exp.	6,000
Note Payable (final payment due 2032)	140,000		Interest Expense	12,000
Gerri Faber, Capital	431,000

Required:

1. Prepare a multiple-step income statement.

2.Prepare a statement of Owners equity

3.  Prepare a balance sheet, assuming that the current portion of the note payable is $7,000.

Answer 1