The following information applies to the questions displayed below.] Ity ice cre

ID: 340657 • Letter: T

Question

The following information applies to the questions displayed below.] Ity ice cream shops. The company offers dozens of different flavors, from Very Berry Strawberry to lowfat Espresso 'n Cream. Assume thet o local Baskin-Robbins in Raleigh, North Caroline, has the following amounts for the month of July 2018. Salaries expense Inventory (July 1,2018) Sales returns Utilities expense Income tax expense $13,600 Sales revenue 2,250 1,200 3,550 5,900 Interest income Cost of goods sold Rent expense Interest expense Inventory (July 31, 2018) $69,300 3,200 28,650 6,600 500 1,200

Explanation / Answer

Baskin – Robbins

Baskin - Robbins

Multiple-Step Income Statement

for the month of July, 2018

Net Sales:

Total Sales Revenue

$69,300

Less: Sales Returns

$1,200

Net Sales Revenue

$68,100

Cost of Goods Sold

($28,650)

Gross Margin

$39,450

Operating Expenses:

salaries expense

$13,600

Utilities expense

$3,550

Rent expense

$6,600

Total Operating Expenses

($23,750)

Operating Income

$15,700

Non-operating items:

Interest Income

$3,200

Interest Expense

($500)

Total

$2,700

Income Before Taxes

$18,400

Income tax expense

($5,900)

Net Income

$12,500