Chapter 4 IS and RE statement Soll

Chapter 4 IS and RE statement Soll - Chapter 04 BRIEF...

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Unformatted text preview: Chapter 04 BRIEF EXERCISE 4-1 Tim Allen Co. Income Statement For the Year 2007 Revenues Sales $540,000 Expenses Cost of goods sold............................................................. $320,000 Wage expense..................................................................... 120,000 Other operating expenses.................................................. 10,000 Income tax expense............................................................ 25,000 Total expenses......................................................... 475,000 Net income....................................................................................... $65,000 Earnings per share.......................................................................... $0.65* *$65,000 ÷ 100,000 shares. Note: The increase in value of the company reputation and the unrealized gain on the value of patents are not reported. BRIEF EXERCISE 4-2 Turner Corporation Income Statement For the Year Ended December 31, 2007 Revenues Net sales............................................................................ $2,400,000 Interest revenue................................................................ 31,000 1 Total revenues.......................................................... 2,431,000 Expenses Cost of goods sold........................................................... $1,250,000 Selling expenses.............................................................. 280,000 Administrative expenses................................................. 212,000 Interest expense............................................................... 45,000 Income tax expense*........................................................ 193,200 Total expenses....................................................... 1,980,200 Net income $ 450,800 Earnings per share**................................................................... $6.44 *($2,431,000 – $1,250,000 – $280,000 – $212,000 – $45,000) X 30% = $193,200. **$450,800 ÷ 70,000 shares. BRIEF EXERCISE 4-3 Turner Corporation Income Statement For the Year Ended December 31, 2007 Net sales............................................................................. $2,400,000 Cost of goods sold............................................................ 1,250,000 Gross profit............................................................ 1,150,000 Selling expenses................................................................ $280,000 Administrative expenses.................................................. 212,000 492,000 Income from operations.................................................... 658,000 Other revenue and gains Interest revenue..................................................... 31,000 Other expenses and losses 2 Interest expense.................................................... 45,000 14,000 Income before income tax................................................ 644,000 Income tax..........................................................................Income tax....
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This note was uploaded on 09/12/2009 for the course ACCT 0301311 taught by Professor Mostafa during the Spring '09 term at Abu Dhabi University.

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Chapter 4 IS and RE statement Soll - Chapter 04 BRIEF...

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