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Kellogg Company is the world's leading producer of ready-to-eat cereal and a leading producer of grain-based convenience foods such as frozen waffles and cereal bars. Suppose the following items were taken from its 2014 income statement and balance sheet. (All dollars are in millions.)

Type of Account Account Name Dollar Amount
Stockholders' Equity Retained earnings $5,481
Expense Cost of goods sold 7,184
Expense Selling and administrative expenses 3,390
Asset Cash 334
Liability Notes payable 44
Expense Interest expense 295
Liability Bonds payable 4,835
Asset Inventory 910
Revenue Sales revenue 12,575
Liability Accounts payable 1,077
Stockholders' Equity Common stock 105
Expense Income tax expense 512
Prepare an income statement for Kellogg Company for the year ended December 31, 2014.

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tutorAnne

Answer:

Please see answer in the explanation column.

Explanation:

Given,  

Type of Account----- Account Name --- Amount in dollars  

Stockholders' Equity--- Retained earnings ----$5,481  

Expense----- Cost of goods sold ----$7,184  

Expense---- Selling and administrative expenses ----$3,390  

Asset ---Cash -----$334

Liability -----Notes payable---- $44  

Expense---- Interest expense----$ 295  

Liability---- Bonds payable----$ 4,835  

Asset---- Inventory---- $910  

Revenue---- Sales revenue----$12,575

Liability ----Accounts payable---- $1,077  

Stockholders' Equity--- Common stock---- $105

Expense---- Income tax expense -----$512

Journal for income statement for Kellogg Company for the year ended December 31, 2014.

Revenue----  

Sales revenue----$12,575  

Expenses

Cost of goods sold ----$7,184

Selling and administrative expenses $3,390

Interest expense---- $295  

Income tax expense -----$512

Total Expense---$11,381

Net Income = Total Revenue –  Total Expense= $1,194

The Net income of the Kellogg Company for the year ended Dec. 31, 2014, is $23, 956. The preparation of the Income statement is attached below in the form of an MSWord Document.

An income statement, often known as a profit and loss account, is one of a company's financial statements that shows the company's or firm's revenues and expenses for a specific time period. It explains how revenues are converted into net profit or net income.

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