Two accountants for the accounting firm of Pham and Pun are arguing about the merits of presenting an income statement in a multiple-step versus a single-step format. The discussion involves the following 2014 information related to Saghir Company ($000 omitted).Administrative expenseOfficers’ salaries …………….. $ 6,860Depreciation of office furniture and equipment ….. 5,544Cost of goods sold ……………….. 84,798Rental revenue ……………….. 24,122Selling expenseTransportation-out ……………… 3,766Sales commissions …………….. 11,172Depreciation of sales equipment ……….. 9,072Sales …………………… 135,100Income tax …………………. 12,698Interest expense ………………… 2,604Instructions(a) Prepare an income statement for the year 2014 using the multiple-step form. Common shares outstanding for 2014 total 40,550 (000 omitted).(b) Prepare an income statement for the year 2014 using the single-step form.(c) Which one do you prefer? Discuss.View Solution:
Two accountants for the accounting firm of Pham and Pun



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