Home Insert Draw Design Layout References Mailings Review View Help A Times New Roman 12 BIU ab x, x po v Aav ' ' ste Paragraph Styles Editing Dictate Sensitivity board Font is Voice Sensitivity 1. 1 2 + 5 I. Income and Retained Earnings Statement Presentation Tomse Inc. prepared an adjusted trial balance as of December 31, 2017. Below, you will find the relevant portions of that trial balance: Credits Account Cost of goods sold Selling expense Administrative expense Depreciation expense, computer Interest expense Interest income Sales revenue Debits 125,000 35,000 30,000 10,000 5,000 13,000 280,000 43,000 21,000 60,000 Retained earnings, Jan 1, 2017 Inventory, December 31, 2017 Computer equipment Accumulated Depr. Computers Realized gain on sale of store equipment Loss on liability lawsuit Dividends declared 20.000 12,000 30.000 5.000 Financial statements for 2017 will be issued on March 1, 2018. Prior to the issuance of the 2017 statements, you become aware of the following information: aste BI U ab X X* po ' ' Paragraph Styles Editing Dictate Sensitivity board Font Voice Sensitivity . 1 . 3 5 The painting and decorating department was discontinued in 2017. You view the action as meeting the requirements for a discontinued operation. The measurement date was September 1, 2017. Sales and expenses for the discontinued department were as follows (these amounts are included in the above trial balance) Sales Cost of goods sold Selling expense Administrative expense 1/1/17 - 8/30/17 9/1/17 - 12/31/17 50,000 20,000 30,000 22,000 10,000 9,000 4,000 2,000 . The realized gain on store equipment, already recorded, applies to the painting and decorating department. It is anticipated that additional painting and decorating department equipment will be sold at a $30,000 loss in early 2018, The beginning inventory is understated by $10,000. The inventory relates to continuing operations. . ste ab X, X PO ' ' Paragraph Styles Editing Dictate Sensitivity board Font Voice Sensitivity 2. 3 4 5 COMmum upCidLIOLLS. A decision was made to change depreciation methods for the computer equipment. The change will be effective for 2017. The firm will switch from the Straight-line method to the Double declining balance method depreciation with a 5-year remaining life (as of 1/1/17). The computers were purchased in January of 2016 for $60,000. They were being depreciated over 6 years with no salvage value. Salvage value is now estimated to be $5,000. Note that 2017 depreciation has already been recorded using the straight-line method. The loss on the liability lawsuit is extraordinary in nature. The tax rate applicable to all items (including the prior year) is 30%. Required: A. Using the Excel worksheet, complete a multi-step income statement for 2017. B. Using the Excel worksheet, prepare a statement of retained earnings for 2017. Home Insert Draw Design Layout References Mailings Review View Help A Times New Roman 12 BIU ab x, x po v Aav ' ' ste Paragraph Styles Editing Dictate Sensitivity board Font is Voice Sensitivity 1. 1 2 + 5 I. Income and Retained Earnings Statement Presentation Tomse Inc. prepared an adjusted trial balance as of December 31, 2017. Below, you will find the relevant portions of that trial balance: Credits Account Cost of goods sold Selling expense Administrative expense Depreciation expense, computer Interest expense Interest income Sales revenue Debits 125,000 35,000 30,000 10,000 5,000 13,000 280,000 43,000 21,000 60,000 Retained earnings, Jan 1, 2017 Inventory, December 31, 2017 Computer equipment Accumulated Depr. Computers Realized gain on sale of store equipment Loss on liability lawsuit Dividends declared 20.000 12,000 30.000 5.000 Financial statements for 2017 will be issued on March 1, 2018. Prior to the issuance of the 2017 statements, you become aware of the following information: aste BI U ab X X* po ' ' Paragraph Styles Editing Dictate Sensitivity board Font Voice Sensitivity . 1 . 3 5 The painting and decorating department was discontinued in 2017. You view the action as meeting the requirements for a discontinued operation. The measurement date was September 1, 2017. Sales and expenses for the discontinued department were as follows (these amounts are included in the above trial balance) Sales Cost of goods sold Selling expense Administrative expense 1/1/17 - 8/30/17 9/1/17 - 12/31/17 50,000 20,000 30,000 22,000 10,000 9,000 4,000 2,000 . The realized gain on store equipment, already recorded, applies to the painting and decorating department. It is anticipated that additional painting and decorating department equipment will be sold at a $30,000 loss in early 2018, The beginning inventory is understated by $10,000. The inventory relates to continuing operations. . ste ab X, X PO ' ' Paragraph Styles Editing Dictate Sensitivity board Font Voice Sensitivity 2. 3 4 5 COMmum upCidLIOLLS. A decision was made to change depreciation methods for the computer equipment. The change will be effective for 2017. The firm will switch from the Straight-line method to the Double declining balance method depreciation with a 5-year remaining life (as of 1/1/17). The computers were purchased in January of 2016 for $60,000. They were being depreciated over 6 years with no salvage value. Salvage value is now estimated to be $5,000. Note that 2017 depreciation has already been recorded using the straight-line method. The loss on the liability lawsuit is extraordinary in nature. The tax rate applicable to all items (including the prior year) is 30%. Required: A. Using the Excel worksheet, complete a multi-step income statement for 2017. B. Using the Excel worksheet, prepare a statement of retained earnings for 2017