Which of the following accounts would be reported on a single-step income statement?

• A. Dividends
• B. Service Revenue
• C. Accounts Receivable
• D. Prepaid Insurance

Answer: (B)

Verified step by step guidance

1. Understand the purpose of a single-step income statement: It is a simplified income statement that reports revenues and expenses in a single section, without separating operating and non-operating activities.
2. Identify the types of accounts that appear on a single-step income statement: Only revenue and expense accounts are included. Asset, liability, and equity accounts are excluded.
3. Analyze each account provided in the problem: Dividends are equity accounts, Accounts Receivable and Prepaid Insurance are asset accounts, and Service Revenue is a revenue account.
4. Determine which account fits the criteria for inclusion in a single-step income statement: Since Service Revenue is a revenue account, it is the only account that would be reported on the single-step income statement.
5. Conclude that Service Revenue is the correct answer because it represents income earned by the business, which is relevant to the income statement.