Prepare a Multiple Step Income Statement (Financial Accounting Tutorial #32)

So at this point we have a general idea of the account cost of goods sold which is an expense related to the sale of inventory. How are we going to factor that into an income statement? Well it's going to get its own separate line before listing "period" costs. Cost of goods sold expense will be deducted from net sales to get our "gross margin" or our "gross profit." This term is a way of saying FATTY profit or profit before subtracting all expenses other than inventory expenses!

We go through the preparation of this ubiquitous statement, so give it a watch so that you'll be able to prepare one on your next test/quiz!

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[gian]

So I believe once we put loss on sale (20, 000) our earnings before tax would be 266, 000

(I got this number by 247, 000 (earning from operations) + 19, 000 (revenue made not from operations) =266, 000.

After I subtracted the income tax
266, 000-25, 000= 241, 000

Net income= 241, 000

[rdawg]

Thanks dude! I have a test tomorrow and this helped.

[yadiraperez]

You lost me after other revenues and gains you're not being clear enough on what to do you should of just kept on going as you were at the beginning

[pandaonsteroids]

Thank you a lot for the video, but next time you make a video, please don't cut it short just because you think it's too long. You explained how we're supposed to get the numbers you didn't fill in, but I don't really get it. We much rather the video be long and detailed than short and confusing. For what you did explain though, thanks. It helped a lot.

[hassanjaveed]

Hi Dave Sir, my Net income is 202000.
And love your learning way. This video is very beneficial for me.

[azidhussain]

Can you please specify the indents while you're explaining. My professor cuts points for the indents as well. The reason I say this is because the way you formatted your statement is different from the one shown in textbooks. Thanks.

[Amoney]

sucks you didn't finish explaining this the whole way out

[matinajazmine]

Aren't you supposed to put brackets on the 65000 the one on sales?

[monica]

What about Income from continuing operations before income tax? How is it calculated?

[dpvlogs]

Why Notepirate is doing minus(-) the amounts?

[daverdal]

awesome, great explanation, I also really like the black background. Makes it easy on the eyes!

[accountingforbeginners]

Good explanation of the income statement

[kayg]

can you explain how you got the net income.

[tinabehnke]

Can you please make a tutorial that income tax is not always 30% (income tax) of NPBT and why that is the case and how that can be calculated!? Thank you!!! xoxox

[candiemayhew]

Very disappointed you didn't at least give the total so we could try to finish it out and see if we came up with the same answer. I see one question about the answer and only 2 out of 5 or 6 came up with the same number...

[NicoleeMuzarr]

wait i dont get it from other expenses and losses, how did you get all of your final numbers you didnt really say or showed it

[iskyrisky]

Hi Nate, do you notes on financial statement analysis?

[jayasaxena]

Hello Dave, your videos on Financial Accounting are great and I am really learning a lot. Your video # 31 is missing. I was wondering how I could see that one. Thanks

[lsubandtrumpet]

What is intest gain and dividend revenue?

[neondiamondsaquaberry]

It would have helped to classify the trial balance with multistep, you’re lacking wage revenues, depreciation expenses on equipment etc