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please help am stuck understanding how these properly lay out Problem 4-3 Windsor Inc. reported income from continuing operations before taxes during 2017 of $793,700.
please help am stuck understanding how these properly lay out
Problem 4-3 Windsor Inc. reported income from continuing operations before taxes during 2017 of $793,700. Additional transactions occurring in 2017 but not considered in the $793,700 are as follows. 1. 2. 3. 4. 5. 6. The corporation experienced an uninsured flood loss in the amount of $91,900 during the year. At the beginning of 2015, the corporation purchased a machine for $70,200 (salvage value of $11,700) that had a useful life of 6 years. The bookkeeper used straight-line depreciation for 2015, 2016, and 2017, but failed to deduct the salvage value in computing the depreciation base. Sale of securities held as a part of its portfolio resulted in a loss of $60,900 (pretax). When its president died, the corporation realized $142,600 from an insurance policy. The cash surrender value of this policy had been carried on the books as an investment in the amount of $46,110 (the gain is nontaxable). The corporation disposed of its recreational division at a loss of $103,520 before taxes. Assume that this transaction meets the criteria for discontinued operations. The corporation decided to change its method of inventory pricing from average-cost to the FIFO method. The effect of this change on prior years is to increase 2015 income by $54,040 and decrease 2016 income by $19,040 before taxes. The FIFO method has been used for 2017. The tax rate on these items is 40%. Prepare an income statement for the year 2017 starting with income from continuing operations before taxes. Compute earnings per share as it should be shown on the face of the income statement. Common shares outstanding for the year are 111,840 shares. (Assume a tax rate of 30% on all items, unless indicated otherwise.) Problem 4-4 The following account balances were included in the trial balance of Sandhill Corporation at June 30, 2017. Sales revenue Sales discounts Cost of goods sold Salaries and wages expense (sales) Sales commissions Travel expense (salespersons) Delivery expense Entertainment expense Telephone and Internet expense (sales) Depreciation expense (sales equipment) Maintenance and repairs expense (sales) Miscellaneous selling expenses $1,590,740 32,570 899,700 57,350 98,130 34,600 22,690 14,980 9,100 5,289 5,707 4,898 Office supplies used 3,373 Telephone and Internet expense (administration) 2,560 Depreciation expense (office furniture and equip Property tax expense Bad debt expense (selling) Maintenance and repairs expense (administratio Office expense Sales returns and allowances Dividends received Interest expense Income tax expense Depreciation understatement due to error2014 Dividends declared on preferred stock Dividends declared on common stock The Retained Earnings account had a balance of $361,900 at July 1, 2016. There are 78,560 shares of common stock outstanding. Using the multiple-step form, prepare an income statement for the year ended June 30, 2017. Problem 4-6 Below is the Retained Earnings account for the year 2017 for Concord Corp. Retained earnings, January 1, 2017 $258,100 Add: Gain on sale of investments (net of tax) Net income Refund on litigation with government, related to the year 2014 (net of tax) Recognition of income earned in 2016, but omitted from income statement in that year (net of tax) $41,700 85,000 22,100 25,900 174,700 432,800 Deduct: Loss on discontinued operations (net of tax) 35,500 Write-off of goodwill (net of tax) 60,500 Cumulative effect on income of prior years in changing from LIFO to FIFO inventory valuation in 2017 (net of tax) 23,700 Cash dividends declared 32,500 Retained earnings, December 31, 2017 152,200 $280,600 (a) Prepare a corrected retained earnings statement. Concord Corp. normally sells investments of the type mentioned above. FIFO inventory was used in 2017 to compute net income Problem 4-7 Ivanhoe Corp. has 149,520 shares of common stock outstanding. In 2017, the company reports income from continuing operations before income tax of $1,222,900. Additional transactions not considered in the $1,222,900 are as follows. 1 . 2 . 3 . 4 . In 2017, Ivanhoe Corp. sold equipment for $37,600. The machine had originally cost $81,200 and had accumulated depreciation of $31,900. The gain or loss is considered non-recurring. The company discontinued operations of one of its subsidiaries during the current year at a loss of $191,600 before taxes. Assume that this transaction meets the criteria for discontinued operations. The loss from operations of the discontinued subsidiary was $90,500 before taxes; the loss from disposal of the subsidiary was $101,100 before taxes. An internal audit discovered that amortization of intangible assets was understated by $38,000 (net of tax) in a prior period. The amount was charged against retained earnings. The company had a non-recurring gain of $129,500 on the condemnation of some of its property (included in the $1,222,900). Analyze the above information and prepare an income statement for the year 2017, starting with income from continuing operations before income tax. Compute earnings per share as it should be shown on the face of the income statement. (Assume a total effective tax rate of 38% on all items, unless otherwise indicated.)Step by Step Solution
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