The Fanta Company presents you with the following account balances taken from its December 31, 2007 adjusted

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The Fanta Company presents you with the following account balances taken from its December 31, 2007 adjusted trial balance:
Inventory, January 1, 2007 ............. $ 43,000
Selling expenses ................. 35,000
Extraordinary gain (pretax) ............ 23,000
Purchases ................... 100,000
Sales .................... 250,000
General and administrative expenses ......... 22,000
Purchases returns ................ $3,500
Interest expense .................. 4,000
Sales discounts taken ............... 2,000
Gain on sale of property (pretax) ......... 7,000
Freight-in .................. 5,000
Additional data:
1. A physical count reveals an ending inventory of $22,500 on December 31, 2007.
2. Twenty-five thousand shares of common stock have been outstanding the entire year.
3. The income tax rate is 30% on all items of income.
Required
1. As a supporting document for Requirements 2 and 3, prepare a separate schedule for Fanta Company’s cost of goods sold.
2. Prepare a 2007 multiple-step income statement.
3. Prepare a 2007 single-step income statement.

Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula                Ending Inventory Formula =...
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
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Intermediate Accounting

ISBN: 978-0324300987

10th Edition

Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones

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