Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

4. Merchandising Operations

Single-step Income Statement

Financial Accounting

4. Merchandising Operations

Single-step Income Statement

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Multiple Choice

Which of the following best describes a single-step income statement?

A financial statement that lists all revenues together and all expenses together, then subtracts total expenses from total revenues to determine net income.

A statement that reports assets, liabilities, and equity at a specific point in time.

A statement that shows changes in cash flows from operating, investing, and financing activities.

A financial statement that separates operating and non-operating activities and calculates gross profit before expenses.

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Verified step by step guidance

Understand the concept of a single-step income statement: It is a financial statement that simplifies the presentation of income by grouping all revenues together and all expenses together, without separating operating and non-operating activities.

Recognize the structure of a single-step income statement: Total revenues are listed first, followed by total expenses. The net income is calculated by subtracting total expenses from total revenues.

Compare the single-step income statement to other financial statements: Unlike a multi-step income statement, it does not calculate gross profit or separate operating and non-operating activities. It also differs from a balance sheet, which reports assets, liabilities, and equity, and a cash flow statement, which shows changes in cash flows from operating, investing, and financing activities.

Identify the correct description from the options provided: The single-step income statement is best described as 'A financial statement that lists all revenues together and all expenses together, then subtracts total expenses from total revenues to determine net income.'

Review the incorrect options: The other descriptions provided refer to different financial statements, such as the balance sheet, cash flow statement, and multi-step income statement, which are not relevant to the single-step income statement.