During 2011 Evelyn Co. Ltd discovered that certain items had been included in inventory at 31 December 2010, valued at $ 2.1m, which had in fact been sold before the year end. The following figures for 2010 (as reported) and 2011 (draft) are available. 2010 2011(draft) $’000 $’000 Sales 23,700 33,600 Cost of goods sold (17,285) (27,900) Profit before taxation 6,415 5,700 Income taxes (1,925) (1,710) Profit for the period 4,490 3,990 Retained earnings at 1 January 2010 and 1 January 2011 were $6,500,000 and 10,990,500 respectively. The cost of goods sold for 2011 includes the $2.1m error opening inventory. The income tax rate was 30% for 2010 and 2011. No dividends have been declared or paid. Required: Show the income statement for 2011, with the 2010 comparative, and retained earnings of Evelyn Co. Ltd
During 2011 Evelyn Co. Ltd discovered that certain items had been included in inventory at
31 December 2010, valued at $ 2.1m, which had in fact been sold before the year end. The
following figures for 2010 (as reported) and 2011 (draft) are available.
2010 2011(draft)
$’000 $’000
Sales 23,700 33,600
Cost of goods sold (17,285) (27,900)
Profit before
Income taxes (1,925) (1,710)
Profit for the period 4,490 3,990
respectively. The cost of goods sold for 2011 includes the $2.1m error opening inventory. The
income tax rate was 30% for 2010 and 2011. No dividends have been declared or paid.
Required:
Show the income statement for 2011, with the 2010 comparative, and retained earnings of
Evelyn Co. Ltd
Step by step
Solved in 3 steps with 4 images
