Sad Help Save & Exit 12 Print Solomon Manufacturing Company (SMC) was started when it acquired $92,000 by issuing common stock. During the first year of operations, the company incurred specifically identifiable product costs (materials, labor, and overhead) amounting to $56,000. SMC also incurred $56,000 of engineering design and planning costs. There was a debate regarding how the design and planning costs should be classified Advocates of Option 1 believe that the costs should be classified as general, selling, and adminiskrative costs. Advocates of Option 2 believe it is more appropriate to classify the design and planning costs as product costs. During the year, SMC made 4.000 units of product and sold 3,100 units at a price of $35.00 each. All transactions were cash transactions. Required 3-1. Prepare a GAAP-based income statement and balance sheet under option 1. a-2. Prepare a GAAP-based Income statement and balance sheet under option 2 b. Identify the option that results in financial statements that are more likely to leave a favorable Impression on investors and creditors c. Assume that SMC provides an incentive bonus to the company president equal to 13 percent of net income. Compute the amount of the bonus under each of the two options. Identify the option that provides the president with the higher bonus. d. Assume a 35 percent income tax rate. Determine the amount of income tax expense under each of the two options. Identify the option that minimizes the amount of the company's income tax expense. Complete this question by entering your answer in the tabs below. Req Al Inc Sumt Req Al Bar Sheet Red A2 Inc Stmt Req A2 Dal Sheet Rego Reqc Reg D Prepare a GAAP-based income statement for Option 1. 1c raw III surve....pptx edmonds_surve...pptx Social Media docx PR and sociale....DIY O PR and social Blackboard TTU mall 2 EN Cloud UNDAYS Connect ion.com Disney Hulu Atmos SONA Connect Extra Credit Assignment Saved Help UFU DUHUSU UCHUN NU UIS. WE HUVIUSURES WIDE SER UND d. Assume a 35 percent income tax rate. Determine the amount of income tax expense under each of the two options. Identify the option that minimizes the amount of the company's income tax expense. Save & Exit 12 Complete this question by entering your answer in the tabs below. P ReqB Regc Reg D Reg Al Inc Reg A1 Bal Red A2 Inc Reg A2 B Stmt Sheet Stmt Sheet Prepare a GAP-based Income statement for Option 1. SOLOMON MANUFACTURING COMPANY Income Statement Sales revenue Selling general and administrative expenses Gross margin Design expenses income tax expenses Not income 5 108.500 56,000 52.500 56,000 $ 3,500) Req A1 Bal Sheet > nnect Extra Credit Assignment i Saved Help Save & Exit Reg Al Inc Somt Reg Al Bal Sheet Reg A2 Inc Stmt Reg A2 Bal Sheet 12 Reg Reqc Reg D Prepare a GAP-based balance sheet for Option 1. SOLOMON MANUFACTURING COMPANY Balance Sheet Print Assets 0 Accounts payable Accumulated depreciation Cash Common stock Finished goods inventory Retained earnings Total equity HOR Deneyt Ames SONA ect Extra Credit Assignment Seved Help Save & Exit Su Req Al Inc Stmt Roq Al Bal Sheet Reg A2 Inc Stmt Reg A2 Bal Sheet RGB Regc Reg D 2 Prepare a GAAP-based income statement for Option 2 SOLOMON MANUFACTURING COMPANY Income Statement Cost of goods sold Design expenses Income tax expenses Sales revenue Selling, general, and administrative expenses net ReqA2 Bal Sheet Connect Hi Disney A Atmos SONA act Extra Credit Assignment Save Help Save & E.it Sut Req Al Inc Stmt Reg A1 Bal Sheet Reg A2 Inc Stmt Reg A2 Bal Sheet Req B Reqc Reg D 2 Prepare a GAAP.based balance sheet for Option 2 SOLOMON MANUFACTURING COMPANY Balance Sheet Assets Accounts payable Accumulated depreciation Cash 0 Common stock Finished goods Inventory Retained earnings Total equity $ Help Uue volway UOPULARMIS WUS VESTI d. Assume a 35 percent income tax rate. Determine the amount of income tax expense under each of the two options. Identify the option that minimizes the amount of the company's income tax expense. Save & Exit SL 12 Complete this question by entering your answer in the tabs below. Prire Reg Al Inc Stmt Reg A1 Bal Sheet RAGA2 Inc Simt Reg A2 B Sheet Rega Regc ReqD Assume a 35 percent income tax rate. Determine the amount of income tax expense under each of the two options. Identify the option that minimizes the amount of the company's income tax expense. (Round your answers to the nearest whole dollar.) Option no. 1 income tax expense Option no. 2 income tax expense The option that minimizes the amount of the companys Income tax expense surve....pptx edmonds_surve...pptx Social Media docx PR and sociale....DIY O PR and social Blackboard TTU mall 2 EN Cloud UNDAYS Connect ion.com Disney Hulu Atmos SONA Connect Extra Credit Assignment Saved Help UFU DUHUSU UCHUN NU UIS. WE HUVIUSURES WIDE SER UND d. Assume a 35 percent income tax rate. Determine the amount of income tax expense under each of the two options. Identify the option that minimizes the amount of the company's income tax expense. Save & Exit 12 Complete this question by entering your answer in the tabs below. P ReqB Regc Reg D Reg Al Inc Reg A1 Bal Red A2 Inc Reg A2 B Stmt Sheet Stmt Sheet Prepare a GAP-based Income statement for Option 1. SOLOMON MANUFACTURING COMPANY Income Statement Sales revenue Selling general and administrative expenses Gross margin Design expenses income tax expenses Not income 5 108.500 56,000 52.500 56,000 $ 3,500) Req A1 Bal Sheet > nnect Extra Credit Assignment i Saved Help Save & Exit Reg Al Inc Somt Reg Al Bal Sheet Reg A2 Inc Stmt Reg A2 Bal Sheet 12 Reg Reqc Reg D Prepare a GAP-based balance sheet for Option 1. SOLOMON MANUFACTURING COMPANY Balance Sheet Print Assets 0 Accounts payable Accumulated depreciation Cash Common stock Finished goods inventory Retained earnings Total equity HOR Deneyt Ames SONA ect Extra Credit Assignment Seved Help Save & Exit Su Req Al Inc Stmt Roq Al Bal Sheet Reg A2 Inc Stmt Reg A2 Bal Sheet RGB Regc Reg D 2 Prepare a GAAP-based income statement for Option 2 SOLOMON MANUFACTURING COMPANY Income Statement Cost of goods sold Design expenses Income tax expenses Sales revenue Selling, general, and administrative expenses net ReqA2 Bal Sheet Connect Hi Disney A Atmos SONA act Extra Credit Assignment Save Help Save & E.it Sut Req Al Inc Stmt Reg A1 Bal Sheet Reg A2 Inc Stmt Reg A2 Bal Sheet Req B Reqc Reg D 2 Prepare a GAAP.based balance sheet for Option 2 SOLOMON MANUFACTURING COMPANY Balance Sheet Assets Accounts payable Accumulated depreciation Cash 0 Common stock Finished goods Inventory Retained earnings Total equity $ Help Uue volway UOPULARMIS WUS VESTI d. Assume a 35 percent income tax rate. Determine the amount of income tax expense under each of the two options. Identify the option that minimizes the amount of the company's income tax expense. Save & Exit SL 12 Complete this question by entering your answer in the tabs below. Prire Reg Al Inc Stmt Reg A1 Bal Sheet RAGA2 Inc Simt Reg A2 B Sheet Rega Regc ReqD Assume a 35 percent income tax rate. Determine the amount of income tax expense under each of the two options. Identify the option that minimizes the amount of the company's income tax expense. (Round your answers to the nearest whole dollar.) Option no. 1 income tax expense Option no. 2 income tax expense The option that minimizes the amount of the companys Income tax expense