In 2008, Randa Merchandising, Inc., sold its interest in a chain of wholesale outlets, taking the company completely out of the wholesaling business. The company still operates its retail outlets. A listing of the major sections of an income statement follows:

A. Income (loss) from continuing operations B. Income (loss) from operating, or gain (loss) from disposing, a discontinued segment C. Extraordinary gain (loss)

Indicate where each of the following income-related items for this company appears on its 2008 income statement by writing the letter of the appropriate section in the blank beside each item.

Section Item Debit Credit _______ 1. Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,900,000 _______ 2. Gain on state’s condemnation of company property (net of tax) . . . . . . . . . . . . 230,000 _______ 3. Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . $1,480,000 _______ 4. Income taxes expense . . . . . . . . . . . . . . . . . . . . 217,000 _______ 5. Depreciation expense . . . . . . . . . . . . . . . . . . . . 232,500 _______ 6. Gain on sale of wholesale business segment (net of tax) . . . . . . . . . . . . . . . . . . . . . 775,000 _______ 7. Loss from operating wholesale business segment (net of tax) . . . . . . . . . . . . . . . . . . . . . 444,000 _______ 8. Salaries expense . . . . . . . . . . . . . . . . . . . . . . . . 640,000.

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