Preparing a multi step income statement and calculating gross profit percentage
The records of Grade A Steak Company list the following selected accounts for the quarter ended April 30, 2012:
|
Interest revenue |
$ 800 |
Accounts payable |
$ 17,000 |
|
Inventory |
45,100 |
Accounts receivable |
33,500 |
|
Note payable, long–term |
47,000 |
Accumulated depreciation |
37,600 |
|
Salary payable |
2,400 |
Angus, capital, Jan 31 |
53,300 |
|
Sales discounts |
2,000 |
Angus, drawing |
20,000 |
|
Sales returns and allowances |
7,500 |
Cash |
7,600 |
|
Sales revenue |
296,100 |
Cost of goods sold |
162,100 |
|
Selling expense |
38,300 |
Equipment |
130,600 |
|
Supplies |
5,700 |
General expenses |
16,300 |
|
Unearned sales revenue |
13,300 |
Interest payable |
1.200 |
Requirements
1. Prepare a multi step income statement.
2. M. Davidson, manager of the company, strives to earn gross profit percentage of at least 50% and net income percentage of 20%. Did Grade A achieve these goals? Show your calculations.