Problem 124 Presented below is information related to Farr Company. Retained ear
ID: 2489959 • Letter: P
Question
Problem 124 Presented below is information related to Farr Company. Retained earnings, December 31, 2014 Sales revenue Selling and administrative expenses Hurricane loss (pre-tax) on plant (extraordinary item) Cash dividends declared on common stock Cost of goods sold Gain resulting from computation error on depreciation charge in 2013 (pre-tax)525,900 Other revenue Other expenses $ 648,700 1,505,500 232,200 295,100 33,600 880,400 111,500 106,700 Prepare in good form a multiple-step income statement for the year 2015 . Assume a 30% tax rate and that 80,000 shares of common stock were outstanding during the year. (Round per share values to 2 decimal places, eg. $1.58.)Explanation / Answer
SOLUTION INCOME STATEMENT OF FARR CPMPANY REVENUES & GAIN SALES REVENUE 1505500 GAIN RESULTING FROM COMPUTAION ERROR 525900 OTHER REVENUE 111500 2142900 EXPENSES & LOSSES SELLING & ADMINISTATIVE EXPENSES 232200 HURRICANE LOSS 295100 COST OF GOODS SOLD 880400 OTHER EXP 106700 1514400 EBT 628500 LESS- TAX@30% 188550 EAT 439950