Using the multiple-step form, prepare an income statement for the year ended Jun
ID: 2391072 • Letter: U
Question
Using the multiple-step form, prepare an income statement for the year ended June 30, 2017. (Round earnings per share to 2 decimal places, e.g. 1.48.)
The following account balances were included in the trial balance of Tamarisk Corporation at June 30, 2017.Sales revenue $1,579,860 Depreciation expense (office furniture and equipment) $6,762 Sales discounts 31,690 Property tax expense 6,843 Cost of goods sold 897,100 Bad debt expense (selling) 4,503 Salaries and wages expense (sales) 56,690 Maintenance and repairs expense (administration) 8,281 Sales commissions 98,950 Office expense 5,980 Travel expense (salespersons) 31,900 Sales returns and allowances 63,694 Delivery expense 23,150 Dividends received 39,910 Entertainment expense 15,110 Interest expense 16,440 Telephone and Internet expense (sales) 9,080 Income tax expense 98,290 Depreciation expense (sales equipment) 5,069 Depreciation understatement due to error—2014 (net of tax) 17,004 Maintenance and repairs expense (sales) 6,440 Dividends declared on preferred stock 9,210 Miscellaneous selling expenses 5,045 Dividends declared on common stock 38,360 Office supplies used 3,368 Telephone and Internet expense (administration) 3,097
The Retained Earnings account had a balance of $364,510 at July 1, 2016. There are 83,970 shares of common stock outstanding.
Explanation / Answer
Twain Corporation Income Statement For the Year Ended June 30, 2017 Sales Revenue 1,579,860 Less: Sales Discounts 31,690 Sales Returns and allowances 63,694 95,384 Net Sales 1,484,476 Cost of goods sold 897100 Gross Profit 587,376 Operating Exprenses Selling Expense Salaries and Wages Expense 56,690 Sales Commission 98,950 Travel Expense 31900 Delivery Expense 23,150 Entertainment Expense 15,110 Telephone and Internet Expense 9,080 Maintenance and Repairs Expense 6,440 Depreciation Expense 5,069 Bad Debt Expense 4,503 Miscellaneous Selling Expense 5,045 255,937 Administrative Expenses Maintenance and Repairs Expense 8,281 Property Tax Expense 6,843 Depreciation of Office Equipment 6,762 Office Expense 5,980 Office Supplies 3,368 Telephone and Internet Expense 3,097 34,331 Income from Operations 297,108 Other Revenues and Gains Dividend Revenue 39,910 39,910 337,018 Other Expenses and Losses Interest Expense 16,440 Depreciation understatement due to error 17,004 33,444 Income before Income Tax 303,574 Income Tax 98,290 Net Income for the Year 205,284 Earnings per common share (205284-9,210)/ 83,970 shares 2.34
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