Best Company Sells Office Supplies Required: Prepare an Income Statement for Best Company, a Merchandiser

Essay

Best Company sells office supplies. The following information summarizes Best's operating activities for 2012:
$\begin{array}{|l|r|}\hline\text { Utilities for store } & \$ 6,000 \\\hline \text { Rent for store } & \$ 8,000 \\\hline \text { Sales commissions } & \$ 4,500 \\\hline \text { Purchases of merchandise } & \$ 54,000 \\\hline \text { Inventory on January } 1,2012 & \$ 30,000 \\\hline \text { Inventory on December } 31,2012 & \$ 20,500 \\\hline \text { Sales revenue } & \$ 108,000\\\hline\end{array}$

Required: Prepare an income statement for Best Company, a merchandiser, for the year ended December 31, 2012.using the format below. Please include a vertical analysis rounded to the nearest tenth of a percent.
$$\begin{array} { | l | l | l | l | } \hline \text { Sales revenue } & \quad\quad\quad &\quad\quad\quad &\quad\quad\quad \\\hline \text { Cost of goods sold } & & & \\\hline \text { Beginning inventory } & & & \\ \hline \text { Purchases } & & & \\\hline \text { Cost of goods available for sale } & & & \\\hline \text { Ending inventory } & & & \\\hline \text { Cost of goods sold } & & & \\\hline \text { Gross profit } & & & \\\hline \text { Selling expenses } & & & \\\hline \text { Sales commissions } & & & \\\hline \text { General expenses } & & & \\\hline \text { Rent expense } & & & \\\hline \text { Utilities expense } & & & \\\hline \text { Total operating expenses } & & & \\\hline \text { Net income/(loss) } & & & \\\hline\end{array}$$