The following data were taken from the records of Amana Bread Corporation for the year ended October 31, 2008:

Income statement data:

Administrative expenses ...............$ 80,000

Cost of merchandise sold ............... 458,000

Gain on condemnation of land ............. 80,000

Income tax:

Applicable to continuing operations ............ 36,800

Applicable to loss from discontinued business segment ... 24,000

Applicable to gain on condemnation of land ......... 32,000

Interest expense .................... 5,000

Interest revenue .................... 4,000

Loss from discontinued operations ........... 60,000

Loss from fixed asset impairment ............. 35,000

Restructuring charge .................. 65,000

Sales .......................955,000

Selling expenses ....................224,000

Retained earnings and balance sheet data:

Accounts payable ................... $ 47,800

Accounts receivable ..................185,000

Accumulated depreciation ...............465,000

Accumulated other comprehensive loss .......... 28,000

Allowance for doubtful accounts ............. 5,400

Cash .........................165,300

Common stock, $1 par (100,000 shares authorized;

82,000 shares issued) ................. 82,000

Deferred income taxes payable (current portion, $5,400) ... 28,300

Dividends:

Cash dividends for common stock ............. 35,000

Cash dividends for preferred stock ............ 16,000

Stock dividends for common stock ............ 12,000

Dividends payable .................. 12,750

Employee termination obligation (current) .......... 45,000

Equipment ...................... 1,958,000

Income tax payable ................... 11,200

Interest receivable .................. 2,500

Merchandise inventory (October 31, 2008), at lower

of cost (FIFO) or market ................122,000

Notes receivable .................... 42,500

Paid-in capital from sale of treasury stock .......... 16,000

Paid-in capital in excess of par—common stock ......451,000

Paid-in capital in excess of par—preferred stock ...... 8,000

Patents ....................... 14,000

Preferred 8% stock, $100 par (10,000 shares authorized;

2,000 shares issued) .................200,000

Prepaid expenses .................. 2,600

Retained earnings, November 1, 2007 .......... 1,277,250

Temporary investment in marketable equity securities .....122,000

Treasury stock (2,000 shares of common

stock at cost of $20 per share) .............. 40,000

Unrealized loss on temporary equity securities (net of taxes) .. 28,000

Instructions

1. Prepare a multiple-step income statement for the year ended October 31, 2008, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 80,000 and preferred dividends were $16,000.

Assume that the gain on condemnation of land is an extraordinary item.

2. Prepare a retained earnings statement for the year ended October 31, 2008.

3. Prepare a balance sheet in report form as of October 31, 2008.