AC300-Unit6ExcelTemplate - P5-9 MisclassificationsThe...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: P5-9 MisclassificationsThe bookkeeper for the Olson Company prepared the following income statement and retained earnings statement for theyear ended December 31, 2010:OLSON COMPANYDecember 31, 2010Expense and Profits StatementSales (net)$196,000 Less: Selling expenses(19,600)Net sales$176,400 Add: Interest revenue2,300 Add: Gain on sale of equipment3,200 Gross sales revenues$181,900 Less: Costs of operationsCost of goods sold$120,100 Correction of overstatement in last years income because of error(net of $1,650 income tax credit)3,850 Dividend costs ($0.50 per share for 8,000 common shares) 4,000 Extraordinary loss because of earthquake (net of $1,800 income tax credit)4,200 (132,150)Taxable revenues$49,750 Less: Income tax on income from continuing operations(12,480)Net income$37,270 Miscellaneous deductionsLoss from operations of discontinued Division L (net of $900 income tax credit)$2,100 Administrative expenses 16,800 16,800 (18,900)Net revenues$18,370 OLSON COMPANYRetained Revenues StatementFor Year Ended December 31, 2010Beginning retained earnings$59,300 Add: Gain on sale of Division L (net of $1,350 income taxes)3,150 Recalculated retained earnings$62,450 Add: Net revenues18,370 $80,820 Less: Interest expense(3,400)Ending retained earnings$77,420...
View Full Document

This note was uploaded on 07/10/2011 for the course ACCOUNTING 116 - 301 taught by Professor Levine during the Spring '11 term at Kaplan University.

Page1 / 5

AC300-Unit6ExcelTemplate - P5-9 MisclassificationsThe...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online