An Adjusted Trial Balance of Meadows Company as of December

question 97

Essay

An adjusted trial balance of Meadows Company as of December 31,2019 is given below.Prepare a multi-step income statement for the year for the company.
$$\begin{array} { | l | r | r | } \hline & { \text { Debit } } & \text { Credit } \\\hline \text { Cash } & \$ 15,000 & \\\hline \text { Accounts Receivable } & 42,000 & \\\hline \text { Merchandise Inventory } & 60,000 & \\\hline \text { Supplies } & 15,000 & \\\hline \text { Land } & 300,000 & \\\hline \text { Accounts Payable } & & \$ 3,000 \\\hline \text { Notes Payable } & & 25,000 \\\hline \text { Meadows, Capital } & & 326,000\\\hline \text { Meadows, Withdrawals } &3,000 & \\\hline \text { Sales Revenue } & & 465,000 \\\hline \text { Cost of Goods Sold } &240,000& \\\hline \text { Salaries Expense } & 15,000 & \\\hline \text { Utilities Expense } & 69,000 & \\\hline \text { Rent Expense } & 54,000 & \\\hline \text { Interest Expense } & \underline { 6,000 }\\\hline \text { Totals } & \$ 819,000 & \$ 819,000\\\hline\end{array}$$

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Definitions:

Marginal Product

The extra output or benefit received from using one additional unit of a resource.

Opportunity Cost

The cost of an alternative that must be forgone in order to pursue a certain action, the benefits you could have received by taking an alternative action.

Marginal Cost

The cost added by producing one more item of a product, a crucial factor in economic decision-making regarding production levels.

Economic Profit

The difference between a firm’s total revenues and its total costs, including both explicit and implicit costs, representing the actual financial gain.