Divine Merchandising Income Statement Example

Merchandising companies do not use a schedule of raw materials placed in production or a schedule of cost of goods manufactured and they use a merchandise inventory account instead of a finished goods inventory account.

Merchandising income statement example. This is called the traditional format income statement. Would have the following heading. Please give example of an Income Statement for a merchandising business.

Operating expenses totaled 13000. Examples include salaries and commissions of salespersons expenses for salespersons travel delivery advertising rent or depreciation if owned and utilities on a sales building sales supplies used and depreciation on delivery trucks used in sales. To summarize the important relationships in the income statement of a merchandising firm in equation form.

For example in the income statement for Unique Products Inc the gross profit is 25000. Pauls Guitar Shop Inc. A merchandiser faces inventory-related expenses that reduce net income expenses with no counterpart in a service company.

Describe merchandising operations and inventory systems. For the Year Ended December 31 2015. There is a new section for the Cost of Goods Sold.

For every dollar in sales generated 25 cents were left to pay for the cost of daily operations. Selling expenses are expenses a company incurs in selling and marketing efforts. The next step is to format the columns that you have made in the workbook.

Below are forms of income statement for each company. Here is the format. Cost of Goods Sold Gross Profit Less.