Manty Company listed the following selected pretax items in its December 31, 2007 adjusted trial balance:

Additional information:
The preferred shares had been outstanding the entire year; annual dividends were declared and paid in 2007. During 2007, 2,000 common shares were issued on July 2, and 6,000 common shares were issued on November 3. Common dividends of $12,500 were declared and paid in 2007. The company is subject to a 30% income tax rate.
Required
Prepare the Manty Company's 2007 income statement (multiple-step) and the relatednote.

Transcribed Image Text:

Debit Credit 60,000 90,000 206,000 Nonconvertible, 8% preferred stock, $100 par Common stock, $5 par Sales Cost of goods sold Gain on disposal of discontinued Division B Extraordinary gain from bond retirement Operating expenses Loss from operations of discontinued Division B $131,000 8,000 15,000 19,250 20,000