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Summary Statement of Comprehensive Income R133,00
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Summary Statement of Comprehensive Income

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The only way to master the Income statement is through analysing the adjustments. I have explain the important adjustments in this document that will make it easier for students to draw up the Income statement

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Document information

  • January 8, 2022
  • 25
  • 2021/2022
  • Summary

Subjects

  • statement of comprehensive income

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, Table of Contents

Topic Page
1.Statement of Comprehensive Income 2-3
2.Golden rule 4
3.Financial period 4
4. WANT/HAVE formula 4
5. Income received in advance 5-8
6. Prepaid expense 9-10
7. Accrued income 11-12
8. Accrued expense 12-13
9. Bad debts 14-15
10. Bad debts recovered 15-16
11. Provision for bad debt 16-18
12. Depreciation 19-21
13. Trading stock 21-22
14. Consumable stores 22-23
15. Interest income 23
16. Interest expense 24




1

, Statement of Comprehensive Income


 The Statement of Comprehensive Income is used to determine the financial
performance/results of the business
 Income and expenses are the only elements used to compile the Statement of
Comprehensive Income
 Always focus on the nominal accounts section and consider adjustments



Sales – Sales returns Revenue/Net sales
Cost of sales

If cost of sales is not given, calculate them as follows:

Opening Inventory – given on the trial balance
+Purchases
+ Carriage costs such as:
• Carriage on purchases
• Custom tariffs /duties
• Delivery fee
• Import duties
• Shipping fee
• Railage cost
• Etc – any cost of bringing goods into the business
premises
-Purchases returns
-Goods taken owner/Goods donated
-Closing Inventory – given on the adjustment/additional
information

Gross profit
(Revenue/Net Sales minus Cost sales)

Other operating income – here we looking at the other
sources of income besides sales /trading

 Rent income
 Commission income
 Discount received
 Profit on sale of asset
 Bad debts recovered
 Provision for bad debts adjustment
 Trading stock surplus
2

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