A single-step income statement: Is not permitted when financial statements are prepared in accordance with generally accepted accounting principles. Reports the same amount of net income as that reported on a multiple-step income statement. Reports revenues and expenses, but not gains and losses. Always includes a gross profit subtotal. Never includes selling expenses.

Question

Business

Mikayla Lawson

7 June, 07:14

A single-step income statement: Is not permitted when financial statements are prepared in accordance with generally accepted accounting principles. Reports the same amount of net income as that reported on a multiple-step income statement. Reports revenues and expenses, but not gains and losses. Always includes a gross profit subtotal. Never includes selling expenses.

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Answers (1)

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Rory Archer · Answer 1

The correct answer is letter "B": Reports the same amount of net income as that reported on a multiple-step income statement.

Explanation:

The single-step income statement is a summarized report portraying a firm's revenue at the top, expenses at the bottom, and net income below expenses. It shows brief financial information compared to the multiple-step income statement which also includes the accounts from operating and non-operating activities.

Though, even if the single and multiple-step income statements use different formats both must show the same net income of the organization.