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You are a summer inter at the office of a local tax preparer. To test your basic knowledge of financial statements, your manager gives
You are a summer inter at the office of a local tax preparer. To test your basic knowledge of financial statements, your manager gives you the following list of accounts and asks you to prepare a simple income statement using those accounts a. Arrange the accounts into a well-labeled income statement. Make sure you label and solve for gross profits, operating profits, and net profits before taxes b. Using a 35% tax rate, calculate taxes paid and net profits after taxes. e. Assuming a dividend of $1.00 per share with 4.16 million shares outstanding, calculate EPS and additions to retained earnings a. Complete the income statement, down to the net profits before taxes ine, below (Select the account names from the drop-down menus and round the amounts to two decimal places) Name of Company Income Statement (5000,000) 1 2 Gross prof Less: Operating expenses 2 4 5. a Total operating expense $ Operating profits (EBIT) 7 Net profits before tax
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