Big Tommy Corporation is a local grocery store organized seven years ago as a corporation. The bookkeeper prepared the following statement at year-end (assume that all amounts are correct, but note the incorrect format):

Required:

1. Prepare a properly formatted multistep income statement that would be used for external reporting purposes.
2. Compute and interpret the gross profit percentage (using the formula shown in this chapter and rounding to one decimal place).

Transcribed Image Text:

BIG TOMMY CORPORATION Profit and Loss December 31 Debit Credit Net Sales $404,000 Cost of Goods Sold $279,000 Salaries and Wages Expense 58,000 Office Expenses Travel Expenses 16,000 1,000 Income Tax Expense 15,000 Net Profit 35,000 Totals $404,000 $404,000