The following balances were taken from the books of\nMaria Conchita Alonzo Corp. on December 31, 2014.\nInterest revenue $ 86,000 Accumulated depreciati
The following balances were taken from the books of
\r\nMaria Conchita Alonzo Corp. on December 31, 2014.
\r\nInterest revenue $ 86,000 Accumulated depreciation—equipment $ 40,000
\r\nCash 51,000 Accumulated depreciation—buildings 28,000
\r\nSales revenue 1,380,000 Notes receivable 155,000
\r\nAccounts receivable 150,000 Selling expenses 194,000
\r\nPrepaid insurance 20,000 Accounts payable 170,000
\r\nSales returns and allowances 150,000 Bonds payable 100,000
\r\nAllowance for doubtful accounts 7,000 Administrative and general expenses 97,000
\r\nSales discounts 45,000 Accrued liabilities 32,000
\r\nLand 100,000 Interest expense 60,000
\r\nEquipment 200,000 Notes payable 100,000
\r\nBuildings 140,000 Loss from earthquake damage
\r\nCost of goods sold 621,000 (extraordinary item) 150,000
\r\nCommon stock 500,000
\r\nRetained earnings 21,000
\r\nAssume the total effective tax rate on all items is 34%.
\r\nInstructions
\r\nPrepare a multiple-step income statement; 100,000 shares of common stock were outstanding during the year.