Reference no: EM132880361

Problem - Cost of Goods Sold and Income Statement - Schuch Company presents you with the following account balances taken from its December 31 adjusted trial balance:

Inventory, January 1	$43,000	Purchases returns	$3,500
Selling expenses	35,000	Interest expense	4,000
Purchases	100,000	Sales discounts taken	2,000
Sales	250,000	Gain on sale of property (pretax)	7,000
General and administrative expenses	22,000	Freight-in	5,000

Additional data:

1. A physical count reveals an ending-inventory of $22,500 on December 31.

2. Twenty-five thousand shares of common stock have been outstanding the entire year.

3. The income tax rate is 30% on all items of income.

Required -

1. As a supporting document for Requirements 2 and 3, prepare a separate schedule for Schuch's cost of goods sold.

2. Prepare a multiple-step income statement.

3. Prepare a single-step income statement.