The following income statement items appeared on the adjusted trial balance of Schembri Manufacturing Corporation for the year ended December 31, 2018 ($ in 000s): sales revenue, $19,300; cost of goods sold, $8,200; selling expenses, $1,500; general and administrative expenses, $1,000; interest revenue, $280; interest expense, $320. Income taxes have not yet been recorded. The company's income tax rate is 40% on all items of income or loss. These revenue and expense items appear in the company's income statement every year. The company's controller, however, has asked for your help in determining the appropriate treatment of the following nonrecurring transactions that also occurred during 2018 ($ in 000s). All transactions are material in amount. 1. Investments were sold during the year at a loss of $420. Schembri also had unrealized gains of $530 for the year on investments. 2. One of the company's factories was closed during the year. Restructuring costs incurred were $2,300. 3. During the year, Schembri completed the sale of one of its operating divisions that qualifies as a component of the entity according to GAAP. The division had incurred a loss from operations of $760 in 2018 prior to the sale, and its assets were sold at a gain of $1,800. 4. In 2018, the company's accountant discovered that depreciation expense in 2017 for the office building was understated by $400. 5. Negative foreign currency translation adjustment for the year totaled $440. Required: 1. Prepare Schembri's single, continuous multiple-step statement of comprehensive income for 2018, including earnings per share disclosures. One million shares of common stock were outstanding at the beginning of the year and an additional 400,000 shares were issued on July 1, 2018. 2. Prepare a separate statement of comprehensive income for 2018. For the year ending December 31, 2018, Benson Corporation had income from continuing operations before taxes of $1,230,000 before considering the following transactions and events. All of the items described below are before taxes and the amounts should be considered material. 1. In November 2018, Benson sold its Pancake Village restaurant chain that qualified as a component of an entity. The company had adopted a plan to sell the chain in May 2018. The income from operations of the chain from January 1, 2018, through November was $163,000 and the loss on sale of the chain's assets was $306,000. 2. In 2018, Benson sold one of its six factories for $1,260,000. At the time of the sale, the factory had a book value of $1,130,000. The factory was not considered a component of the entity. 3. In 2016, Benson's accountant omitted the annual adjustment for patent amortization expense of $123,000. The error was not discovered until December 2018. Required: Prepare Benson's income statement, beginning with income from continuing operations before taxes, for the year ended December 31, 2018. Assume an income tax rate of 20%. Ignore EPS disclosures. (Amounts to be deducted should be indicated with a minus sign.)
