Question 3 The following information is available for Norrman Corporation for th

Question

Question 3 The following information is available for Norrman Corporation for the year ended December 31, 2017: sales revenue dividends $32,000. The company's tax rate was 35%, and it had 50,000 shares outstanding during the entire year 35,000 other revenues and sns $99,000, operating expenses $107,000 cost of goods sold $470,000 other expenses and losses $33,000 and prefe ed stock Prepare a corporate income statement. (List other revenues before other expenses.) Cekulate eamings per share. (Round answer to 2 decimal places, e.g. 2.25 Earrings per share

Explanation / Answer

Solution 1:

Solution 2:

Earning for common shareholders = Net Income - Preference dividend = $210,600 - $32,000 = $178,600

Common shares outstanding = 50000 shares

Earning per share = Earnings for common share holders / Average outstanding common shares

= $178,600 / 50000 = $3.57 per share

Norman Corporation Income Statement For the year ended December 31, 2017 Particulars Amount Sales Revenue $835,000.00 Cost of goods sold $470,000.00 Gross Margin $365,000.00 Opearting expenses $107,000.00 Operating Income $258,000.00 Other revenues and gain $99,000.00 Other expenses and losses $33,000.00 Income before taxes $324,000.00 Income tax expense (35%) $113,400.00 Net Income $210,600.00

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