Question

The accounts of Consolidated Can contain the following amounts at December 31, 2012:                       Cost of products...

The accounts of Consolidated Can contain the following amounts at December 31, 2012:

                      Cost of products sold                                                                            $410,000

                      Dividends                                                                                                       3,000

                      Extraordinary gain (net of tax)                                                                   1,000

                      Income taxes                                                                                                 9,300

                      Interest expense                                                                                           8,700

                      Other income                                                                                                1,600

                      Retained earnings, 1/1                                                                            270,000

                      Sales                                                                                                            480,000

                      Selling and administrative expense                                                         42,000

Required: prepare a multiple-step income statement combined with a reconciliation of retained earnings for the year ended December 31, 2012

                      Answer:

Homework Answers

Answer #1
Multiple - step Income Statement
For the Year Ended December, 31, 2012
$ $
Revenues
Sales     480,000.00
Cost of goods sold    (410,000.00)
Gross Profit       70,000.00
Operating Expenses
Selling and Administrative Expense     (42,000.00)
Income from Operations       28,000.00
Other Income or Expense
Other income         1,600.00
Interest expense       (8,700.00)
Dividend       (3,000.00)
Income from continuing operations before income tax     (10,100.00)
Income tax       (9,300.00)
Income before taxes and extraordinary items       8,600.00
Extraordinary items, gain, net of tax         1,000.00
Net Income       9,600.00
Retained Earnings Statement
For the Year Ended December 31, 2012
$
Retained Earnings: January 1, 2012     270,000.00
Add: Net income        9,600.00
Retained Earnings: December 31, 2012 279,600.00
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