# Washington Company has the following account balances, extracted from its multiple-step income...

## Question:

Washington Company has the following account balances, extracted from its multiple-step income statement for the current year. Compute the missing amounts.

Sales = $105,100 Sales Returns and Allowances = ? Sales Discounts = 4,700 Net Sales = ? Cost of Goods Sold = 61,100 Gross Profit = 36,800 Selling Expenses = ? General and Administrative Expenses = 8,700 Total Operating Expenses = 20,600 Net Income = ? ## Income Statement: The income statement for a given firm is one of the four financial statements for a given financial period, others being the balance sheet, the cash flow statement and the statement of change in the shareholders' equity. It is usually prepared in the form of a single-step statement or a multi-step statement. ## Answer and Explanation: The net sales amount is given by: • = Gross Profit + cost of goods sold • =$36,800 + $61,100 • =$97,900

The sales returns and allowances is given by:

• = Sales - net sales - sales discounts
• = $105,100 -$97,900 - $4,700 • =$2,500

The selling expenses is given by:

• = Total operating expenses - general and administrative expenses
• = $20,600 -$8,700
• = $11,900 The net income is given by: • = Gross profit - total operating expenses • =$36,800 - $20,600 • =$16,200 