Need to find: 1. Income before extraordinary items 2. Extraordinary items 3. Net income

Pucket Corp. is in the process of preparing its financial statements for the year ended December 31, Year 4. Before closing the books, it prepared the following:

Condensed Trial Balance

December 31, Year 4 Debit Credit

Total assets 7,082,500

Total liabilities 1,700,000

Common stock 1,250,000

Additional paid in capital 2,097,500

Donated capital 90,000

Retained earnings, 1/1/year 4 1,650,000

Net sales 6,250,000

Cost of sales 3,750,000

Selling and administrative expenses 1,212,500

Interest expence 122,500

Gain on sale of longterm investments 130,000

Income tax expence 300,000

Loss on disposistion of plant assets 225,000

Loss due to earthqueake damage 475,000

Total: $13,167,500 $13,167,500

Other financial data for the year ended December 31, Year 4.

Sales returns and allowances equaled $215,00, and sales discounts taken were $95,000

Estimated federal income tax payments were $200,000, and accrued federal income taxes equaled $100,000. The total charged to income tax expense does not properly reflect current or deferred income tax expense or interperiod income tax allocation for income statement purposes. The enacted tax rate on all types of taxable income for the current and future years is 30%. The alternative minimum tax is less than the regular income tax.

Interest expense includes 6% interest on 20 year bonds issued at their face amount of $1,500,000

A $90,000 excess of carrying amount over tax basis in depreciable assets arose from receipt of a contribution of equipment by a local government on December 31, year 4. It is expected to be depreciated over 5 years beginning in year 5. There were no temporary differences prior to year 5.

Officers life insurance expense (not tax deductible) is $70,000

The earthquake damage is considered unusal and infrequent, but the dispostition of plant assets is considered infrequent but not unusal. Moreover, the disposition of plant assets was not a disposal of a component of an entity.

The shares of common stock ($5 par) traded on a national exchange:

Outstanding at 1/1/year 4 200,000

Issued on 3/30/year 4 as a 10% stock dividend 20,000

Issued shares for $25 per share on 6/30/year 4 30,000

Outstanding at 12/31/Year 4 250,000

Pucket declared a $1.25 common stock dividend on December 28, year 4.