apter 4 - Part Rembrandt Paint Company had the following income statement items

Question

apter 4 - Part Rembrandt Paint Company had the following income statement items for the year ended December 31, 2016 ($ in 000s): 4 Net sales Interest income Interest expense 27,000 290 530 15,000 3,400 1,700 Cost of goods sold Selling and administrative expenses Restructuring costs oints Print In addition, during the year the company completed the disposal of its plastics business and incurred a loss from operations of $2.5 million and a gain on disposal of the component's assets of $3.8 million. 600,000 shares of common stock were outstanding throughout 2016. Income tax expense has not yet been recorded. The income tax rate is 40% on all items of income (loss). Required: Prepare a multiple-step income statement for 2016, including EPS disclosures. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands except earnings per share. Round EPS answers to 2 decimal places) For the Year Ended December 31, 2016 ($ in thousands, ex r share amounts) 4 of 8

Explanation / Answer

REMBRANDT PAINT COMPANY Income Statement For the Year Ended December 31, 2016 ($ in thousands, except per share amounts) Sales revenue $      27,000 Cost of goods sold          15,000 Gross profit          12,000 Operating expenses Selling and administrative $      3,400 Restructuring costs          1,700            5,100 Operating income            6,900 Interest income (expense), net             (240) (290-530) Income from continuing operations before income taxes            6,660 Income tax expense at 40%            2,664 Income from Continuing operations $        3,996 Discontinued operations Income from operations of discontinued component $      1,300 (3800-2500) Income tax expense             520 Income on discontinued oprations               780 Net income            4,776 Earnings per share: Income from continuing operations              6.66 Income on discontinued operations              1.30 Net Income              7.96 Note: please feel free to ask in comment, if there is something not clear. Thanks

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