1. Assume that the Boehm Furniture Company%u2019s chief financial officer gave y

Question

1.            Assume that the Boehm Furniture Company%u2019s chief financial officer gave you the following information: net sales, $2,000,000; cost of goods sold, $1,050,000; extraordinary gain (net of income taxes of $3,500), $12,500; loss from discontinued operations (net of income tax benefit of $30,000), $50,000; loss on disposal of discontinued operations (net of income tax benefit of $13,000), $35,000; selling expenses, $50,000; administrative expenses, $40,000; income taxes expense on continuing operations, $300,000. From this information, prepare the company%u2019s income statement for the year ended June 30, 20xx. (Ignore earnings per share information.)

Explanation / Answer

Income Statement Net Sales 2000000 COGS 1050000 Income from Cont. Operations 950000 Less: Taxes 300000 Net Income 650000 Add: Extraordinary gain 12500 Loss from disc.operations -50000 Loss on disposal -35000 Selling exp. -50000 admin. Exp. -40000 Net Income 487500

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