Shown below is information relating to operations of Broadway Industries for 201

Question

Shown below is information relating to operations of Broadway Industries for 2015.

Complete the income statement for Broadway Industries, including earnings per share figures. Broadway Industries has 100,000 shares of a single class of common stock outstanding throughout the year.

Continuing operationss: Net sales $6,500,000 Cost and expenses (including income taxes) $5,720,000 Other data: Current-year profit generated by segment of the business discontinued in May (net of income taxes) $542,100 Gain on disposal of discontinued segment (net of income taxes) $185,900 Prior-period adjustment (decrease in prior years income net of tax benefit) $347,100 Extraordinary loss (net of income tax benefit) $325,000 Cash dividends declared ($6 per share) $520,000

Explanation / Answer

Income Statement for the year ended December 31 2015

Prior period adjustment will be excluded from the current year's income statement. It will be adjusted in the beginning balance of retained earnings.

Cash dividends would also be included in the statement of retained earnings as a deduction.

$ $ Continuing Operations Net Sales 6,500,000 Costs and expenses 5,720,000 Profit before exceptional item from continuing operations 780,000 Extraordinary loss 325,000 Profit for the year from continuing operations 455,000 Discontinued operations Profit for the year from discontinued operations 542,100 Gain on disposal of discontinued segment 185,900 Profit for the year 11,83,000 Earnings per share for continuing operations $ 4.55 Earnings per share for discontinued operations $ 7.28 Earnings per share from continuing and discontinued operations $ 11.83

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