Reference no: EM132653966

Question - The following are selected ledger accounts of Whispering Winds Rose Corporation at December 31, 2020:

Cash $190,000

Entertainment expense $68,000

Inventory (as of Jan. 1, 2020) 530,000

Office expense 34,000

Sales revenue 4,237,000

Insurance expense 24,000

Unearned revenue 125,000

Advertising expense 50,000

Purchases 2,833,000

Freight out 92,000

Sales discounts 32,000

Depreciation expense of office equipment 51,000

Purchase discounts 25,000

Depreciation expense of sales equipment 36,000

Salaries and wages expense (sales) 280,000

Telephone and Internet expense (sales) 18,000

Salaries and wages expense (administrative) 351,000

Utilities expense (administrative) 32,000

Purchase returns and allowances 18,000

Miscellaneous expense 7,000

Sales returns and allowances 76,000

Rental revenue 230,000

Freight in 69,000

Loss on disposal of equipment 84,000

Accounts receivable 140,000

Interest expense 154,000

Sales commission expense 85,000

Common shares 1,000,000

Whispering Winds's Rose effective tax rate on all items is 25%. A physical inventory indicates that the ending inventory is $680,000. The number of common shares outstanding is 100,000.

Required - Prepare a condensed multi-step 2020 income statement for Whispering Winds Rose Corporation, showing expenses by function. Whispering Winds Rose follows ASPE but decides to disclose EPS on its income statement.