Presented below is information related to ColorCity Inc. for year of 2020 (1/1/2020-12/31/2020).

Selling and administrative expenses	$ 1,114,000
Interest expenses	140,000
Net Sales	3,790,000
Dividends-Common stock	56,000
Income from operations of discontinued food department (pre-tax)	60,000
Interest revenues	260,000
Loss on disposal of discontinued food department (pre-tax)	120,000
Cost of goods sold	1,780,000
Dividends-Preferred stock	125,000
Retained earnings, 1/1	630,000

Instruction: Use the worksheet provided (see page 2) or use a white paper, then

1. Calculate the following five subtotals/amounts on a multiple step income statement:

(1) Gross Profit, (2) Income From Operations, (3) Income before tax, (4) Income tax expense, , and (5) Income from continuing operations. Show your work in addition to the answer. Assume a tax rate of 30%.

2. Prepare in good form a partial multiple-step income statement for the year 2020 for ColorCity Inc. starting from Income from continuing operations. Also include a proper heading.

3. Assume that 140,000 shares of common stock were outstanding during the year. Calculate earnings per share based on the net income (round to two decimals). Show your work in addition to the answer.

You can type your work by using WORD or do handwriting. Please make your handwriting clear and neat.