How to Prepare a Income Statement by qjn14978

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									Instructions for the Microsoft Excel Templates

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Place the proper account title in the cell where the word "Account title" appears on the template.

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Write a formula into cells where the word "Formula" appears. In these cells, an amount calculated can be entered. An amount
can be placed in these cells.

Place the explanation for the entry in the cell where the word "Text Explanation" appears on the template.

Insert the account number where "Acct Nbr" appears on the template during posting.

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Much of the exercises and problems can have data entered by the "look to" or "=A34" type formula where cell A34 contains
the data to be entered. This precludes typing and data entry errors.




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      Name:                                                        Date:
 Instructor:                                                    Course:
Financial Accounting, Fifth Edition by Kimmel, Weygandt, and Kieso
Solving Financial Accounting Problems Using Microsoft Excel for Windows
                                 by Rex A Schildhouse
E5-8, Prepare multiple-step income statement and calculate profitability ratios.
In its income statement for the year ended December 31, 2010, Maris Company reported the following condensed data.

      Administrative expenses                $435,000                 Selling expenses                   $490,000
      Cost of goods sold                      987,000                 Loss on sale of equipment            83,500
      Interest expense                         68,000                 Net sales                         2,050,000
      Interest revenue                         65,000                 Income tax expense                   20,000

 Instructions:
(a) Prepare a multiple-step income statement.

                                                   MARIS COMPANY
                                                    Income Statement
                                          For the Year Ended December 31, 2010
            Title                                                                                    Amount
            Account title                                                                            Amount
            Title                                                                                    Formula
            Title
              Account title                                                         Amount
              Account title                                                         Amount
                 Title                                                                               Formula
            Title                                                                                    Formula
            Title
              Account title                                                         Amount
            Title
              Account title                                       Amount
              Account title                                       Amount            Formula          Formula
            Title                                                                                    Formula
            Account title                                                                            Amount
            Title                                                                                    Formula

(b)(1) Calculate the profit margin ratio and gross profit rate.
                                                  Title                   Amount
              Profit margin ratio:      =                         =                      =        Formula
                                                  Title                   Amount

(b)(2) Calculate the profit margin ratio and gross profit rate.
                                                  Title                   Amount
               Gross profit rate:       =                         =                      =        Formula
                                                  Title                   Amount

(c) In 2009 Maris had a profit margin ratio of 5%. Is the decline in 2010 a cause for concern?

Enter text answer here.




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