Sales revenue 700,000
Interest revenue 60,000
Gain on sale of land (infrequent but not unusual) 110,000
Cost of goods sold 500,000
Salaries and wages150,000
Depreciation expense 40,000
Interest expense 30,000
Marketing and administrative expenses 60,000

Plano had 50,000 shares of stock outstanding throughout the year. Income tax expense has not yet been accrued. The effective tax rate is 30%.

I was wondering how to do it the basics
I'm not sure where to put salaries and wages because when I add it to operating expenses I get a balance of 250,000 and my gross profit is 200,000

Sales revenue 700,000
Interest revenue 60,000
Gain on sale of land (infrequent but not unusual) 110,000
Cost of goods sold 500,000
Salaries and wages150,000
Depreciation expense 40,000
Interest expense 30,000
Marketing and administrative expenses 60,000

Plano had 50,000 shares of stock outstanding throughout the year. Income tax expense has not yet been accrued. The effective tax rate is 30%.


I'm not sure where to put salaries and wages because when I add it to operating expenses I get a balance of 250,000 and my gross profit is 200,000


Sales revenue 700,000
Cogs 500,000
Gross profit 200,000
Operating expenses
Depreciation 40,000
Marketing and administative 60,000
Salaries wages 150,000
Total operating expense 250,000
Operating income (50,000)

Please refer to the following link, you will get the idea

Principles of Accounting Chapter 5

I'm preparing a income statement with a gain on sale of land (infrequent but not unusual item) I'm confused on whether I should include it in operating expenses or other income (expenses) ?

Salaries and Wages Expense is a variable operating expense.

There is no rule in life that says your operating expenses can't exceed your gross profit.

Quote:

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Originally Posted by pready

Salaries and Wages Expense is a variable operating expense.

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When preparing a multiple step income statement, distinction is not made for fixed and variable costs. Please read the Chapter I have quoted.

Please do not keep making multiple posts from the same problem. It just makes things confusing for everyone. I have merged all the posts relevant to this problem into one thread.