Appendix I
Review Exercise Solutions
409
Part 2
a) Prepare a single-step income statement
George’s Gardening Supplies
Income Statement
For the Year Ended December 31, 2016
Revenue
Sales Revenue
$113,500
Less: Sales Returns and Allowances
$1,000
Sales Discounts
1,580
(2,580)
Interest Revenue
6,500
Total Revenue
117,420
Expenses
Cost of Goods Sold
44,700
Depreciation Expense
5,000
Insurance Expense
2,500
Interest Expense
2,600
Rent Expense
6,000
Salaries Expense
11,000
Supplies Expense
4,500
Utilities Expense
750
Total Operating Expenses
77,050
Net Income
$40,370
