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homework%20solutions%20chapters%205a - E5-51.GOLD...

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Unformatted text preview: E5-51.GOLD COMPANYIncome StatementFor Year Ended December 31, 2007 Sales $200,000Less: Sales returns and allowances (5,000)Net sales$195,000Cost of goods sold (101,000)Gross profit$ 94,000Operating expensesSelling expenses $28,000General and administrative expenses 20,000Total operating expenses (48,000)Operating income$ 46,000Other itemsInterest revenue $ 4,000Loss from strike (9,000) (5,000)Income before income tax and extraordinary items$ 41,000Income tax expense (12,300)Income before extraordinary items$ 28,700Extraordinary loss (net of $5,100 income tax credit) (11,900)Net Income$ 16,800Earnings per Common ShareComponents of Income (7,000 common shares) Income before extraordinary items$4.10Extraordinary loss (1.70)Net income$2.40E5-5 (continued)2.GOLD COMPANYIncome StatementFor Year Ended December 31, 2007RevenuesSales (net of $5,000 returns and allowances)$195,000Interest revenue 4,000Total revenues$199,000ExpensesCost of goods sold$101,000Selling expenses 28,000General and administrative expenses 20,000Loss from strike 9,000Income tax expense* 12,300Total expenses (170,300)Income before extraordinary items$ 28,700Extraordinary loss (net of $5,100 income tax credit) (11,900)Net Income$ 16,800Earnings per Common ShareComponents of Income (7,000 common shares) Income before extraordinary items$4.10Extraordinary loss (1.70)Net income$2.40*Note to Instructor: $12,300 = 30% x $41,000 ($199,000 - $101,000 - $28,000 - $20,000 - $9,000)E5-61.ADANDT COMPANYIncome StatementFor Year Ended December 31, 2007 Sales $163,000Less: Sales returns and allowances (3,000)Net sales$160,000Cost of goods sold (95,000)Gross profit$ 65,000Operating expensesSelling expenses $14,000General and administrative expenses 17,000Total operating expenses (31,000)Operating income$ 34,000Other itemsInterest revenue $ 2,500Loss on sale of equipment (2,000) 500 Income before income tax and extraordinary items$ 34,500Income tax expense (10,350)Income before extraordinary items$ 24,150Extraordinary loss (net of $2,400 income tax credit) (5,600)Net Income$ 18,550Earnings per Common ShareComponents of Income (7,000 common shares) Income before extraordinary items$3.45Extraordinary loss (0.80)Net income$2.65E5-6 (continued)2.ADANDT COMPANYIncome StatementFor Year Ended December 31, 2007RevenuesSales (net of $3,000 returns and allowances)$160,000Interest revenue 2,500Total revenues$162,500ExpensesCost of goods sold$ 95,000Selling expenses 14,000General and administrative expenses...
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This note was uploaded on 04/17/2008 for the course ACCT 3110 taught by Professor Stanwick during the Spring '08 term at Auburn University.

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homework%20solutions%20chapters%205a - E5-51.GOLD...

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