1. LESSON 15-1 Preparing an Income Statement Mr. Hunter
4/23/2017
Chapter 15
Preparing an Income Statement
Mr. Hunter

2. INCOME STATEMENT INFORMATION ON A WORK SHEET
page 448

3. REVENUE SECTION OF AN INCOME STATEMENT FOR A MERCHANDISING BUSINESS
page 449
1. Heading
6. Contra account amounts
2. Revenue section
7. Contra account total
3. Title of revenue account
8. Net Sales
4. Sales amount
9. Net sales amount
5. Less contra accounts

4. COST OF MERCHANDISE SOLD SECTION OF AN INCOME STATEMENT FOR A MERCHANDISING BUSINESS
page 450
1. Cost of Merchandise Sold section
2. Beginning inventory
3. Purchases section
4. Total cost of merchandise available for sale
5. Ending inventory
6. Cost of merchandise sold

5. COMPLETING AN INCOME STATEMENT FOR A MERCHANDISING BUSINESS
page 452
1. Gross Profit on Sales
2. Expenses section
3. Net Income before Federal Income Tax
4. Less Federal Income Tax Expense
5. Net Income after Federal Income Tax
6. Double lines
7. Component percentage

6. LESSON 15-1 Analyzing an Income Statement
4/23/2017
LESSON 15-2
Analyzing an Income Statement

7. ANALYZING AN INCOME STATEMENT SHOWING A NET LOSS
page 457

8. FINANCIAL RATIOS Earnings per Share Price-Earnings Ratio
page 459
Earnings per Share
Earnings per Share =
Number of Shares Outstanding ÷
Net Income after Federal Income Tax
$80,313.95 ÷
2,500 =
$32.13
Price-Earnings Ratio
Price-Earnings Ratio =
Earnings per Share ÷
Market Price per Share
$345.00 ÷
$32.13 =
10.7

9. LESSON 15-1 Preparing a Statement of Stockholder’s Equity
4/23/2017
LESSON 15-3
Preparing a Statement of Stockholder’s Equity

10. CAPITAL STOCK SECTION OF THE STATEMENT OF STOCKHOLDERS’ EQUITY
page 461
1. Heading
2. Capital Stock and Par Value
3. Stock at the beginning of the year
4. Stock issued during the year
5. Total stock issued at the end of the year

11. RETAINED EARNINGS SECTION OF THE STATEMENT OF STOCKHOLDERS’ EQUITY
page 462
1. Retained Earnings
4. Dividends declared
2. Beginning balance
5. Increase in retained earnings
3. Net income after federal income tax
6. Ending balance
7. Total stockholders’ equity

12. LESSON 15-1 Preparing a Balance Sheet
4/23/2017
LESSON 15-4
Preparing a Balance Sheet

13. BALANCE SHEET INFORMATION ON A WORK SHEET
page 464

14. CURRENT ASSETS SECTION OF A BALANCE SHEET
page 465
1. Heading
3. Book value of accounts receivable
4. Asset accounts
2. Begin assets section
5. Current assets

15. PLANT ASSETS SECTION OF A BALANCE SHEET
page 466
1. Write the heading Plant Assets.
2. Calculate the book value of office equipment.
3. Use the same procedure to calculate the book value of store equipment.
4. Calculate total plant assets.
5. Calculate total assets.

16. LIABILITIES SECTION OF A BALANCE SHEET
page 467
1. Heading
2. Account title and amount of each current liability
3. Total liabilities

17. STOCKHOLDERS’ EQUITY SECTION OF A BALANCE SHEET
page 468
1. Stockholders’ Equity
5. Total liabilities and stockholders’ equity
2. Capital stock
6. Double rules
3. Retained earnings
4. Total stockholders’ equity

18. COMPLETED BALANCE SHEET
page 469
(continued on next slide)

19. COMPLETED BALANCE SHEET
page 469
(continued from previous slide)

20. Chapter Schedule April 6 Lecture, Application 15-1 April 8
Application 15-4, 15-5 (counts as your test) (due at 1:50 on April 10)