Prepare a single-step income statement and a retained earnings statement.

(Single-Step Income, Retained Earnings, Periodic Inventory) Presented below is the trial balance of Thompson Corporation at December 31, 2014.

 

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THOMPSON CORPORATION

Trial Balance

December 31, 2014

Debits Credits
Purchase Discounts   $10,000
Cash $189,700  
Accounts Receivable 105,000  
Rent Revenue   18,000
Retained Earnings   160,000
Salaries and Wages Payable   18,000
Sales   1,100,000
Notes Receivable 110,000  
Accounts Payable   49,000
Accumulated Depreciation-Equipment   28,000
Sales Discounts 14,500  
Sales Returns 17,500  
Notes Payable   70,000
Selling Expenses 232,000  
Administrative Expenses 99,000  
Common Stock   300,000
Income Tax Expense 53,900  
Cash Dividends 45,000  
Allowance for Doubtful Accounts   5,000
Supplies 14,000  
Freight-in 20,000  
Land 70,000  
Equipment 140,000  
Bonds Payable   100,000
Gain on Sale of Land   30,000
Accumulated Depreciation-Building   19,600
Inventory 89,000  
Building 98,000  
Purchases 610,000  
Totals $1,907,600 $1,907,600

 

A physical count of inventory on December 31 resulted in an inventory amount of $64,000 thus, cost of goods sold for 2014 is $645,000

 

Instructions

Prepare a single-step income statement and a retained earnings statement. Assume that the only changes in retained earnings during the current year were from net income and dividends. 30,000 shares of common stock are outstanding the entire year.

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