Mgmt_200_Spring_2008_solutions_2-13-08(2,14)

Mgmt_200_Spring_2008_solutions_2-13-08(2,14) -...

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Management 200 – Introductory Financial Accounting–Spring 2008 Krannert School of Management - Purdue University Solutions to class assignment for February 13, 2008 E5-12. THAYER APPLIANCES, INCORPORATED Income Statement For the Year Ended December 31, 2009 Computations in Order Sales revenue. ................................. Given $130,000 Cost of goods sold. .......................... (a) $130,000 - $58,000 (given) 72,000 Gross profit. ..................................... Given 58,000 Operating expenses:
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Unformatted text preview: Administrative expense. ............... Given $10,000 Selling expense. ........................... Given 18,000 Total operating expenses. ......... (b) $10,000 + $18,000 28,000 Income before income taxes. .......... (c) $58,000 - $28,000 30,000 Income tax expense. ................... (d) 25%* x $30,000 7,500 Net income. ..................................... (e) $30,000 - $7,500 $22,500 Earnings per share ($22,500 2,000 shares*) = $11.25 *Given...
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