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 is the primary purpose of a single-step income statement?

To report the changes in owner's equity during the period

To provide a detailed breakdown of operating and non-operating expenses

To present the company's cash inflows and outflows

To show the net income or net loss of a company for a specific period

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Verified step by step guidance

Understand the concept of a single-step income statement: It is a simplified financial statement that calculates net income or net loss by subtracting total expenses from total revenues without categorizing operating and non-operating activities.

Recognize the primary purpose of the single-step income statement: Its main goal is to provide a clear and straightforward presentation of the company's financial performance over a specific period.

Compare the single-step income statement to other financial statements: Unlike the multi-step income statement, which separates operating and non-operating activities, the single-step format focuses solely on the net result (net income or net loss).

Identify the correct answer: The single-step income statement is designed to show the net income or net loss of a company for a specific period, which is its primary purpose.

Avoid confusion with other financial statements: For example, changes in owner's equity are reported in the statement of changes in equity, and cash inflows/outflows are detailed in the statement of cash flows.