please help me with making a journal entries Multi-Step Income Statement For the

Question

please help me with making a journal entries

Multi-Step Income Statement For the Year Ended December 31, Year ales Revenu Sales Revenue, net Cost of Goods Sold $16,010,o00 $11,207,000 Gross Profit $4,803,ooo eratin ties Selling Expenses Advertising Expense Bad Debt Expense Miscellaneous Selling Expenses Sales Force Salaries Expense Selling Commissions Expense Shipping Expense $304,190 $144,090 $80,o5o $224,140 $800,50o $146,o0o Total Selling Expenses Administrative Expenses $1,698,970 Depreciation & Amortization Expense Executive Salaries Expense Insurance Expense Miscellaneous Admin. Expenses Office Supplies Expense Rent Expense Utilities Expense $520,450 $736,460 $20o,00o $2,00o $40,00o $58,000 $122,ooo Total Administrative Expenses Income from Operations 88o $1,425,120 $1,678,910 er Gains Miscellaneous Revenues Interest Expense $480,300o $28o,ooo $200.3oo $1,625,420 $650,168 Income from Continuing Operations before Taxes ncome lax Expense Net Income

Explanation / Answer

Account Title & Narration Debit Credit Year 4 1 Cash 5000000 Sales revenue 5000000 (at the time of original sale of the m/cs. In Nov.Yr.4--for which 5% off coupons were given) 2 Advertising expense(40000*$ 50*5%) 100000 Cash (Bal.fig.) 1900000 Sales Revenue(40000* $ 50) 2000000 (subsequent sale, when (100000-60000)=40000 coupons were utilised by customers) End Yr.4 Redemption of the balance 60000 coupons is a CONTINGENT liability--ie. In the event of customer utilising the coupon & purchasing the machine, will be recorded as in 2. above 3 so,NO Entry need be made Year 5 Prior year Advertising expense(1800* $ 50*5%) 4500 Cash 85500 Sales Revenue 90000 (assuming all redemptions occurred before Jan end in Yr.5) (as coupons are valid for only 3 months from Nov. Yr.4) End Yr.5 NO ENTRY As the coupon validity-period has ended

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