Income Statement Quiz-All numbers are pretax and some accounts may not be nee Un
ID: 2608433 • Letter: I
Question
Income Statement Quiz-All numbers are pretax and some accounts may not be nee Unearned subscription Revenue... $1,500,000 85,000 900,000 Realized Loss from Earthquake in Glassboro, NJ (infrequent and unusual).. 200,000 100, Discontinued operations-Loss on operations and disposal of assets (pretax) 200,000 50,000 150,000 Allowance for Doubtful Accounts 20 ash Dividends Declared and Paid on Common Stock........................ h Dividends Declared and Not Paid on Preferred Stock Selling and Administration Expenses.. Unrealized Gain on Sale of Available for Sale Securities 00,000 50,00 0,00 Other Information: Assume a 30% tax rate. The weighted number shares of commonseck out the end of the year is 100,000 shares. Please show work if possible Shc Al Income fronOpertons . s Non-operational (Correct answer may not agree with number ofines) 2( AX b. Beuliz loss d. Total Other Revenues/Gains/Losses Income before Tax Assume Income from Continuing Operations is [399 .. 800,000 Net Income... Only compute EPS for Net Income EPS. FOR THE NEXT FOUR QUESTIONS, ASSUMEExplanation / Answer
Income statement:
Income from operations= 300000
Total other revenues/gains and losses: -300000
Income before taxes= 0
Income from continuing operation is: 800000
Discontinued operation (net of tax) -140000 [200000*(1-30%)]
net income 660000
EPS= (660000-100000)/100000 = 5.6
Sales 15,00,000 Cost of goods sold -9,00,000 Gross profit 6,00,000 Selling and administration expenses -3,00,000 Income from operations 3,00,000 Other income and losses Dividend and interest income 1,00,000 Realised loss on disposal of equipment -2,00,000 Net other income and losses -1,00,000 Income before unusual items 2,00,000 Realised loss from earthquake -2,00,000 Income before income tax - Income tax expense - Net income -