P4-1 (Multiple-Step Income, Retained Earnings) The following information is rela

Question

P4-1 (Multiple-Step Income, Retained Earnings) The following information is related to Dickinson Company for 2014.Retained earnings balance, January 1, 2014 $ 980,000Sales revenue 25,000,000Cost of goods sold 16,000,000Interest revenue 70,000Selling and administrative expenses 4,700,000Write-off of goodwill 820,000Income taxes for 2014 1,244,000Gain on the sale of investments (normal recurring) 110,000Loss due to fl ood damage—extraordinary item (net of tax) 390,00Loss on the disposition of the wholesale division (net of tax) 440,000Loss on operations of the wholesale division (net of tax) 90,000 Dividends declared on common stock $250,000Dividends declared on preferred stock 80,000Dickinson Company decided to discontinue its entire wholesale operations and to retain its manufacturing operations. On September 15, Dickinson sold the wholesale operations to Rogers Company. During 2014, there were 500,000 shares of common stock outstanding all year.InstructionsPrepare a multiple-step income statement and a retained earnings statement.

Explanation / Answer

Income Statement :-

Earnings Per Share :-

Particulars Amount($) Amount($) Sales 25000000 Less : Cost of Goods Sold (16000000) Gross Profit 9000000 Less : Selling and Administrative Expenses (4700000) Income from Operatiions 4300000 Add : Other Revenues and Gains Interest Revenue 70000 Gain on the sale of investments 110000 180000 Less : Other Expenses and Losses Write off of Goodwill (820000) (820000) Income From continuing operations before income tax 3660000 Less : Income Tax (1244000) Income from Continuing Operations 2416000 Less : Discontinued Operations Loss on Operations, Net of Tax 90000 Loss on Disposal, net of tax 440000 (530000) Income before extraordinary item 1886000 Less : Extraordinary item - Loss from flood damage, Net of Tax (390000) Net Income 1496000

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.