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

In a single-step income statement, how is the net income or loss for the period determined?

By subtracting cost of goods sold from net sales

By subtracting total expenses from total revenues

By subtracting operating expenses from gross profit

By adding operating income to non-operating income

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Verified step by step guidance

Understand the concept of a single-step income statement: It is a simplified format where all revenues are grouped together and all expenses are grouped together, without distinguishing between operating and non-operating items.

Identify the formula for determining net income or loss in a single-step income statement: Net Income = Total Revenues - Total Expenses.

Recognize that 'Total Revenues' includes all income sources, such as operating revenues and non-operating revenues.

Recognize that 'Total Expenses' includes all costs incurred during the period, such as operating expenses, cost of goods sold, and non-operating expenses.

Subtract the total expenses from the total revenues to determine the net income or loss for the period, as per the single-step income statement format.