Question

(CO C) Solar Power Inc. had the following transactions during 2105. Sales revenue $15,000 Equipment rental...

(CO C) Solar Power Inc. had the following transactions during 2105.

Sales revenue

$15,000

Equipment rental revenue

420

Cost of sales

6,200

Selling and administrative expenses

3,500

Interest expense

560

Gain on sale of old machinery

210

Unrealized gain on available for sale securities

156

(A) Prepare multistep income statement of Solar Power Inc., assuming income tax rate applicable to Solar Power is 30%.

(B) Compute comprehensive income.

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Answer #1

(A) Prepare multistep income statement of Solar Power Inc., assuming income tax rate applicable to Solar Power is 30%.

Sales revenue 15000
Less: Cost of sales -6200
Gross profit 8800
Less: Selling and administrative expenses -3500
Operating income 5300
Other revenue and expense
Equipment rental revenue 420
Gain on sale of old machinery 210
630
Interest expense -560 70
Income before tax 5370
Less: Income tax -1611
Net income 3759

b) Comprehensive income = Net income+Other comprehensive income

= 3759+(156*70%)

Comprehensive income = 3868.20

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