The accountant for Weatherspoon Shoe has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2022.
Rent revenue ………………………………………………………………………………………………. £ 29,000
Interest expense ……………………………………………………………………………………………..18,000
Unrealized gain on non-trading equity securities, net of tax …………………………… 31,000
Selling expenses …………………………………………………………………………………………… 140,000
Income tax …………………………………………………………………………………………………….. 30,600
Administrative expenses ………………………………………………………………………………. 181,000
Cost of goods sold ………………………………………………………………………………………… 516,000
Net sales ………………………………………………………………………………………………………. 980,000
Cash dividends declared ………………………………………………………………………………… 16,000
Loss on sale of plant assets ……………………………………………………………………………. 15,000
There were 20,000 ordinary shares outstanding during the year.
Instructions
a. Prepare a comprehensive income statement using the combined statement approach.
b. Prepare a comprehensive income statement using the two statement approach.
c. Which format do you prefer? Discuss.
