E4-8 (Multiple-Step Statement with Retained Earnings) Presented below is information related to Brokaw Corp. for the year 2012. Net sales Cost of goods sold Selling expenses Administrative expenses Dividend revenue Interest revenue $1,200,000 780,000 65,000 48,000 20,000 7,000 Write-off of inventory due to obsolescence Depreciation expense omitted by accident in 2011 Casualty loss (extraordinary item) before taxes Cash dividends declared Retained earnings at December 31, 2011 Effective tax rate of 34% on all items $ 80,000 40,000 50,000 45,000 980,000 Instructions (a) Prepare a multiple-step income statement for 2012. Assume that 60,000 shares of common stock are outstanding. (b) Prepare a retained earnings statement for 2013
E4-8 (Multiple-Step Statement with Retained Earnings) Presented below is information related to Brokaw Corp. for the year 2012. Net sales Cost of goods sold Selling expenses Administrative expenses Dividend revenue Interest revenue $1,200,000 780,000 65,000 48,000 20,000 7,000 Write-off of inventory due to obsolescence Depreciation expense omitted by accident in 2011 Casualty loss (extraordinary item) before taxes Cash dividends declared Retained earnings at December 31, 2011 Effective tax rate of 34% on all items $ 80,000 40,000 50,000 45,000 980,000 Instructions (a) Prepare a multiple-step income statement for 2012. Assume that 60,000 shares of common stock are outstanding. (b) Prepare a retained earnings statement for 2013
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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E4-8 (Multiple-Step Statement with Retained Earnings) Presented below is information related to
Brokaw Corp. for the year 2012.
Net sales
Cost of goods sold
Selling expenses
Administrative expenses
Dividend revenue
Interest revenue
$1,200,000
780,000
65,000
48,000
20,000
7,000
Write-off of inventory due to obsolescence
Depreciation expense omitted by accident in 2011
Casualty loss (extraordinary item) before taxes
Cash dividends declared
Retained earnings at December 31, 2011
Effective tax rate of 34% on all items
$ 80,000
40,000
50,000
45,000
980,000
Instructions
(a) Prepare a multiple-step income statement for 2012. Assume that 60,000 shares of common stock are
outstanding.
(b) Prepare a retained earnings statement for 2012.
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