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Fundamentals of Accountancy, Business, and Management 2: Prepared By: Mark Vincent B. Bantog, LPT

The document discusses the statement of comprehensive income (SCI) and how it differs between service businesses and merchandising businesses. For service businesses, the SCI uses a single-step approach where all revenues are grouped together and all expenses are deducted to calculate net income. For merchandising businesses, the SCI uses a multi-step approach where it calculates gross profit after deducting cost of sales from net sales, then deducts other expenses to calculate net income. Sample SCIs are provided for a service business using the single-step approach and for a merchandising business using the multi-step approach.

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Sherlock Holmes
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69 views

Fundamentals of Accountancy, Business, and Management 2: Prepared By: Mark Vincent B. Bantog, LPT

The document discusses the statement of comprehensive income (SCI) and how it differs between service businesses and merchandising businesses. For service businesses, the SCI uses a single-step approach where all revenues are grouped together and all expenses are deducted to calculate net income. For merchandising businesses, the SCI uses a multi-step approach where it calculates gross profit after deducting cost of sales from net sales, then deducts other expenses to calculate net income. Sample SCIs are provided for a service business using the single-step approach and for a merchandising business using the multi-step approach.

Uploaded by

Sherlock Holmes
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Fundamentals of

Accountancy,
Business, and
Management 2
Prepared by:
MARK VINCENT B. BANTOG, LPT
CHAPTER 3: Statement of Comprehensive
Income (SCI)
 Objectives:
 Identify the elements of the SCI and describe
each of these items for a service business and
a merchandising business.
 Prepare a SCI for a service business using the
single-step approach.
 Prepare a SCI for a merchandising business
using the multi-step approach.
Known as the Income Statement
Reports all income and expenses
during the period.
SERVICE MERCHANDISING
Revenues from Services Net Sales

minus

Cost of Sales

minus equals

Gross Profit

add or minus

Expenses Income or Expenses

equals equals

Profit Profit
Groups all revenue items together and
all expense items together.
Net income is deducted using only one
step, deducting total expenses from
total revenues.
Generally used by small businesses and
service business.
ISKO COMPANY
Statement of Comprehensive Income
For the year ended December 31, 20XX

Revenues
Service Revenue P xx
Interest Income xx
Total Revenue and Income XX

Less: Expenses
Salaries Expense xx
Rent Expense xx
Utilities Expense xx
Insurance Expense xx
Total Expenses (XX)
Profit/Net Income XX
Classifies expenses according to
their function as part of cost sales,
distribution/selling, administrative
and other operating activities.
Provides multiple transactions and
intermediate differences to
highlight significant relationships.
ISKO COMPANY
Statement of Comprehensive Income
For the year ended December 31, 20XX

Net Sales P xxx

Cost of Sales (xxx)

Gross Profit P xxx

Other Operating Income xxx

Total P xxx

Operating Expenses

Distribution Costs P xxx

Administrative Expenses xxx (xxx)

Operating Profit P xxx

Finance Costs (xxx)

Profit/Net Income P xxx


THANK
YOU!

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