Table of Contents

Chapter 1 - Overview of the Income Statement 1

Income Statement Overview.. 1

The Single-Step Income Statement 4

The Multi-Step Income Statement 5

The Condensed Income Statement 5

The Contribution Margin Income Statement 6

The Multi-Period Income Statement 7

How to Construct the Income Statement 8

Income Statement Disclosures. 10

Other Income Statement Topics. 11

The Cash Basis Income Statement 11

The Partial Income Statement 12

Headline Earnings. 12

Earnings per Share. 13

Review Questions. 14

Chapter 2 – Revenue and Expense Presentation on the Income Statement 15

Presentation of Revenue. 15

Presentation of the Cost of Goods Sold. 15

Presentation of Compensation Expense. 16

Presentation of Selling, General and Administrative Expenses. 18

Presentation of Noncash Expenses. 19

Presentation of Utilities. 19

Expenses with Alternative Placements. 19

Presentation of Subtotals. 20

Examples of Income Statement Presentation. 20

Review Questions. 26

Chapter 3 - Discontinued Operations. 27

Discontinued Operations. 27

Discontinued Operations Disclosures. 29

Review Questions. 30

Chapter 4 - Comprehensive Income. 31

Overview of Comprehensive Income. 31

Comprehensive Income Disclosures. 32

Examples of Comprehensive Income Presentation. 36

Review Questions. 38

Chapter 5 – Income Statement Ratio Analysis. 39

Sales Returns and Allowances to Sales. 39

Gross Profit Ratio. 40

Operating Ratio. 40

Net Profit Ratio. 41

Breakeven Point 42

Margin of Safety. 43

Review Questions. 45

Answers to Course Questions. 46

Glossary. 51

Index. 53

 

Final Examination…………………………………………………………………………………………………...55