CHAPTER_4_HOMEWORK_SOLUTIONS

CHAPTER_4_HOMEWORK_SOLUTIONS - CHAPTER4HOMEWORKSOLUTIONS...

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CHAPTER 4 HOMEWORK SOLUTIONS EXERCISE 4-5 (30–35 minutes) PARNEVIK CORP. Income Statement For the Year Ended December 31, 2010 Sales Revenue Sales. ........................................................................ $1,280,0 00 Less: Sales returns and allowances. ................... $150,00 0 Sales discounts. .......................................... 45,00 0 195,0 00 Net sales revenue. .................................................. 1,085,00 0 Cost of goods sold. ................................................ 621,0 00 Gross profit. .................................................................. 464,000 Operating Expenses Selling expenses. ................................................ 194,000 Admin. and general expenses. .......................... 97,00 0 291,0 00 Income from operations. .............................................. 173,000
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EXERCISE 4-5 (Continued) Other Revenues and Gains Interest revenue. ........................................................ 86,000 259,000 Other Expenses and Losses Interest expense. ....................................................... 60,000 Income before tax and extraordinary item. ................ 199,000 Income tax ($199,000 X .34). ..................................... 67,660 Income before extraordinary item. .............................. 131,340 Extraordinary item—loss from earthquake damage. . 120,00 0 Less: Applicable tax reduction ($120,000 X .34). ... 40,8 00 79,200 Net income. .................................................................... $ 52,140 Per share of common stock: Income before extraordinary item
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CHAPTER_4_HOMEWORK_SOLUTIONS - CHAPTER4HOMEWORKSOLUTIONS...

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