Plano had 50,000 shares of stock outstanding throughout the year. Income tax exp

Question

Plano had 50,000 shares of stock outstanding throughout the year. Income tax expense has not yet been accrued. The effective tax rate is 30%.

Required:

Prepare a multiple-step income statement with earnings per share disclosure. (Amounts to be deducted should be indicated with a minus sign. Round EPS answer to 2 decimal places.)

Plano Co. 12/31/2018 Partial Trial Balance Data Debits Credits Sales revenue 760,000 Interest revenue 64,000 Gain on sale of investments 114,000 Cost of goods sold 540,000 Selling expenses 146,000 Interest expense 34,000 General and administrative expenses 108,000

Explanation / Answer

Prepare a multiple-step income statement with earnings per share disclosure.

Sales revenue 760000 Less: Cost of goods sold (540000) Gross profit 220000 Less: Operating expense General and administrative expenses (108000) Selling expenses (146000) (254000) Operating income (34000) Other revenue and gains Gain on sale of investments 114000 Interest revenue 64000 Other expense and losses Interest expense (34000) 144000 Income before tax 110000 Less: Income tax (33000) Net income 77000 Share outstanding 50000 EPS 1.54

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