You are a summer intern 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 21% tax rate, calculate taxes paid and net profits after taxes. c. Assuming a dividend of $1.08 per share with 4.29 million shares outstanding, calculate EPS and additions to retained earnings. a. Complete the income statement, down to the net profits before taxes line, below: (Select the account names from the drop-down menus and round the amounts to two decimal places.) Name of Company Income Statement ($000,000) Data Table $ 1. 2 (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Gross profits $ Less: Operating expenses ($000,000) Accounts 3 $ Depreciation expense General and administrative expenses 24.25 4. 22.15 Sales (Alt + A) 345.16 5 18.74 es 6 Cost of goods sold Lease expense Interest expense 255.93 Total operating expense 3.41 $ 3.41 $ Operating profits (EBIT) 7 Print Done $ Net profits before taxes Choose from any list or enter any number in the input fields and then click Check Answer. LO You are a summer intern 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 21% tax rate, calculate taxes paid and net profits after taxes. c. Assuming a dividend of $1.08 per share with 4.29 million shares outstanding, calculate EPS and additions to retained earnings. a. Complete the income statement, down to the net profits before taxes line, below: (Select the account names from the drop-down menus and round the amounts to two decimal places.) Name of Company Income Statement ($000,000) Data Table $ 1. 2 (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Gross profits $ Less: Operating expenses ($000,000) Accounts 3 $ Depreciation expense General and administrative expenses 24.25 4. 22.15 Sales (Alt + A) 345.16 5 18.74 es 6 Cost of goods sold Lease expense Interest expense 255.93 Total operating expense 3.41 $ 3.41 $ Operating profits (EBIT) 7 Print Done $ Net profits before taxes Choose from any list or enter any number in the input fields and then click Check Answer. LO
