Question
In 2010, Dangerous Dragon, Inc. (a retail clothing company) sold 550,847 units of its product at an average price of $19 per unit. The company
In 2010, Dangerous Dragon, Inc. (a retail clothing company) sold 550,847 units of its product at an average price of $19 per unit. The company reported estimated Returns and allowances in 2010 of 3 percent of gross revenue. Dangerous Dragon actually purchased 550,000 units of its product from its manufacturer in 2010 at an average cost of $9 per unit. Dangerous Dragon began 2010 with 85,000 units of its product in inventory (carried at an average cost of $9 per unit). Operating expenses (excluding depreciation) for Dangerous Dragon, Inc. in 2010 were $2,011,000 and depreciation expense was $113,129. Dangerous Dragon had $10,000,000 in debt outstanding throughout all of 2010. This debt carried an average interest rate of 6 percent. Finally, Dangerous Dragons tax rate was 40 percent. Dangerous Dragons fiscal year runs from January 1 through December 31. Given this information, construct Dangerous Dragons 2010 multi-step income statement. What did Dangerous Dragon, Inc. record as NET INCOME on its 2010 income statement?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started