Explanation:
The preparation of the year 3 annual income statement for Kvass, Inc. is presented below:
Kvass, Inc.
Income statement
For the following year 3
Revenue
Sales Revenue $4,886,000
Total revenues $4,886,000 (A)
Less: Expenses
Other Selling and Administrative Expenses $1,051,000
Other Expenses $248,300
Advertising and Promotion Expenses $552,850
Salaries and Wages Expense $2,525,800
Income Tax Expense $166,850
Interest Expense $114,250
Total expenses $4659,050 (B)
Net income $226,950 (A- B)
