Assignment 4 - Intermediate Accounting Assignment 4 Exercise 4-6 Multiple-step and Extraordinary Items The following balances were taken from the books

Assignment 4 - Intermediate Accounting Assignment 4...

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Intermediate Accounting: Assignment 4 Exercise 4-6: Multiple-step and Extraordinary Items The following balances were taken from the books of Maria Conchita Alonzo Corp. on December 31, 2014. Interest revenue $86,000 Accumulated depr. (building) $28,000 Cash 51,000 NA Notes receivable 155,000 x Sales revenue 1,380,000 x Selling expenses 194,000 Accounts receivable 150,000 NA Accounts payable 170,000 Prepaid insurance 20,000 Bonds payable 100,000 x Sales returns and allowances 150,000 x Admin. and general expenses 97,000 Allowance for doubtful accounts 7,000 NA Accrued liabilities 32,000 x Sales discounts 45,000 x Interest expense 60,000 NA Land 100,000 NA Notes payable 100,000 NA Equipment 200,000 Loss from earthquake (extraord. item) 150,000 NA Building 140,000 Common stock 500,000 x Cost of goods sold 621,000 Retained earnings 21,000 Accumulated depr. (equip) 40,000 Assume that the total effective tax rate on all items is 34%. Prepare a multiple-step income statement. Make it look nice! 100,000 shares of common stock were outstanding during the year. Maria Conchita Alonzo Corporation Income Statement For the Year Ended December 31, 2014 Sales Sales Revenue $1,380,000.00 Less: Sales Discounts $45,000.00 Less: Sales returns and allowances $150,000.00 $195,000.00 Core Net Sales $1,185,000.00 persistance COGS $(621,000.00) Gross profit $564,000.00 Operating Expenses Selling expenses $194,000.00 Admin. & General Expenses $97,000.00 $291,000.00 Operating Income Non operating Functions Non-Operating Interest Revenue $86,000.00 Interest Expense $60,000.00 $26,000.00 Income before taxes $299,000.00 Income Tax $101,660.00 Income from continuing operations $197,340.00 1.97 Extraordinary items -0.99 Loss from earthquake($150,000*1-.34) (Net of tax $99,000.00 Net Income for the year $98,340.00 Earnings Per Share $0.98 0.98 EPS - Operating Section
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Exercise 4-14: Change in Accounting Principle Tim Mattke Company began operations in 2012 and adopted weighted-average pricing for inventory.
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