Principles of Accounting Volume 1
Principles of Accounting Volume 1
19th Edition
ISBN: 9781947172685
Author: OpenStax
Publisher: OpenStax College
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Financial information for BDS Enterprises for the year-ended December 31, 20xx, was gathered from an accounting intern, who has asked for your guidance on how to prepare an income statement format that will be distributed to management. Subtotals and totals are included in the information, but you will need to calculate the values.

Pretax income ?
Gross profit ?
Allocated costs (uncontrollable) $2,030
Labor expense 41,570
Sales 188,000
Research and development (uncontrollable) 310
Depreciation expense 17,000
Net income/(loss) ?
Cost of goods sold 118,440
Selling expense 1,260
Total expenses ?
Marketing costs (uncontrollable) 790
Administrative expense 700
Income tax expense (21% of pretax income) ?
Other expenses 310

 

B. Calculate the profit margin, return on investment, and residual income. Assume an investment base of $100,000 and 6% cost of capital. Round your percentage answers to one decimal place.

Profit margin fill in the blank b354eefc7f83060_1 %
Return on investment fill in the blank b354eefc7f83060_2 %
Residual income $fill in the blank b354eefc7f83060_3  
A. Prepare the income statement using the above information. Round your answers to the nearest dollar.
BDS Enterprises
Income Statement
For the Year Ended Dec. 31,
20хx
Total Expenses
Gross Profit
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Transcribed Image Text:A. Prepare the income statement using the above information. Round your answers to the nearest dollar. BDS Enterprises Income Statement For the Year Ended Dec. 31, 20хx Total Expenses Gross Profit
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