The accountant of Weatherspoon Shoe Co. has compiled the following information from the company's records as a basis for an income statement for the year ended December 31, 2010. Rental revenue $29,000Interest expense 18,000Market appreciation on land above cost 31,000Wages and salaries-sales 114,800Materials and supplies-sales 17,600Income tax 30,600Wages and salaries-administrative 135,900Other administrative expenses 51,700Cost of goods sold 516,000Net sales 980,000Depreciation on plant assets (70% selling, 30% administrative) 65,000Dividends declared 16,000There were 20,000 shares of common stock outstanding during the year. (a) Prepare a multiple-step income statement. (Round earnings per share to 2 decimal places, e. g. 5.25. For multiple entries list from largest to smallest amounts, e. g. 10, 5, 1. Enter all amounts as positive amounts and subtract where necessary.)

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Business

Nitro

14 June, 01:05

The accountant of Weatherspoon Shoe Co. has compiled the following information from the company's records as a basis for an income statement for the year ended December 31, 2010. Rental revenue $29,000Interest expense 18,000Market appreciation on land above cost 31,000Wages and salaries-sales 114,800Materials and supplies-sales 17,600Income tax 30,600Wages and salaries-administrative 135,900Other administrative expenses 51,700Cost of goods sold 516,000Net sales 980,000Depreciation on plant assets (70% selling, 30% administrative) 65,000Dividends declared 16,000There were 20,000 shares of common stock outstanding during the year. (a) Prepare a multiple-step income statement. (Round earnings per share to 2 decimal places, e. g. 5.25. For multiple entries list from largest to smallest amounts, e. g. 10, 5, 1. Enter all amounts as positive amounts and subtract where necessary.)

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Mckenna Crane · Answer 1

The preparation of the multiple-step income statement is presented below:

Weather spoon Shoe Co

Multiple Income statement

For the year ended December 31, 2010

Net sales $980,000

Less: Cost of goods sold $496,000

Gross profit on sales $484,000

Operating Expenses

Less:

Selling expenses

Wages and salaries $114,800

Depreciation expenses (70% * $65,000) $45,500

Materials and supplies $17,600

Administrative expenses

Wages and salaries $135,900

Other administrative expenses $51,700

Depreciation expenses (30% * $65,000) $19,500

Income from operations $99,000

Other Revenues and Gains

Rental revenue $29,000

Other Expenses and Losses

Less: Interest expense $18,000

Income before income tax $110,000

Less: Income tax $37,400

Net income $72,600

Earnings per share ($72,600 : 20,000) $3.63