Need practice income statement questions? Here, you go, in this article you can find the number of income statement questions and at the end- the answer key.
Income Statement Definition
If you want to have information about the company’s income and expenses, then you should search for its Income statement.
An income statement of the company reports its income (revenue & profit earned) and expenses( expenses incurred) over a specified period of time.
Income Statement Practice Questions
Question: 1
For the fiscal year 2020, an income statement showed net sales of $1,000,000, cost of goods sold of $430,000, and overall operating expenses of $370,000.
- Calculate gross profit for the year 2020?
- Calculate the operating net profit for the year 2020?
Question: 2
The following data was gathered from different companies’ income statements for the year 2021.
| X Company | Y Company | Z Company |
Sales | $475,000 | $800,000 | ? |
Sales return & allowance | 37,000 | ? | 24,000 |
Sales discount | 15,000 | 10,000 | 17,000 |
Net sales | ? | 750,000 | ? |
Cost of goods sold | 350,000 | ? | 550,000 |
Gross profit | ? | 350,000 | 125,000 |
Question: 3
The following data was gathered from a portion of XYZ Company’s adjusted trail balance.
Sales | $800,000 | |
Sales return & allowance | 37,000 | |
Sales discount | 15,000 | |
Cost of goods sold | 415,000 | |
Supplies expense | 2,500 | |
Salaries expense | 28,000 | |
Advertising expense | 5,000 | |
Depreciation expense | 10,000 | |
Interest expense | 1,000 |
Required:
Prepare an income statement for the period ending 2021.
Question: 4
An adjusted trail balance was provided by Subhan Company as of December 31, 2019. On Jan 1st, the company possess merchandise inventory of $5,000.
Sales | $100,000 | |
Sales return & allowance | 800 | |
Sales discount | 1,000 | |
Purchases | 70,000 | |
Insurance charges | 6,000 | |
Purchase discount | 600 | |
Freight in | 400 | |
Depreciation expense | 2,000 | |
Salaries expense | 6,000 | |
Merchandise inventory | 20,000 | |
Advertising expenses | 1,000 | |
Tax expense | 7,500 | |
Interest expense | 1,000 |
Required:
Prepare an income statement for the period ending 2019.
Question: 5
The trial balance was taken from Bajaj’s accounts as of December 31, 2014.
Purchases & Sales | $97,500 | $150,000 |
Carriage inwards | 550 |
|
Discount allowed & discount received | 400 | 750 |
Carriage outwards | 300 |
|
Return inwards and return outwards | 4,000 | 3,500 |
Inventory as at 1 January 2014 | 16,000 |
|
Advertising | 1,250 |
|
Dividend received |
| 300 |
Rental | 3,000 | 3,900 |
Bad debt | 1,800 |
|
Salary expenses | 9,000 |
|
Utilities expense | 1,500 |
|
Insurance expense | 2,000 |
|
Cash | 2,600 |
|
Bank | 7,600 |
|
Account receivables and account payables | 50,000 | 68,000 |
Capital |
| 154,950 |
Loan |
| 90,000 |
Freehold premises | 200,000 |
|
Furniture | 8,000 |
|
Motor vehicles | 52,000 |
|
Investment | 32,000 |
|
Accumulated depreciation (furniture) |
| 3,200 |
Accumulated depreciation (motor vehicle) |
| 15,600 |
Drawing | 1,200 | . |
| 490,700 | 490,700 |
- Inventory as of 31 December 2014 was valued at $52,000.
- The rental received is for the period from Jan 2014 to 31 March 2015.
- $200 of utilities was paid in advance.
- The owner had withdrawn 1,300 in goods for his family’s use and no record was made.
- Additional bad debts of $1,100 were to be written off.
- Insurance amounting to $1,000 was still outstanding at the end of the accounting period.
- Depreciation is to be charged as follows:
- Furniture – 20% per annum on cost, straight-line method.
- Motor vehicles $5,200 per year.
- Interest on the loan at 5% per annum has not been paid.
Required:
Prepare an income statement for the period ending 2014.
Question: 6
The following data are related to Mr. Junaid after adjustment at Dec 31, XXXX:
- Sales $250,000
- Merchandise inventory (opening) 10,000
- Purchases 53,000
- Commission income 1,000
- Sales discount 5,000
- Junaid Drawing 19,000
- Utility expense 4,000
- Depreciation expense 5,000
- Bad debt expense 3,000
- Salaries expense 10,000
- Rent expense payable 11,000
- Allowance for bad debts 11,000
- Merchandise inventory (ending) 15,000
Required:
Prepare an income statement with the help of above data.
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