How much was the profit before finance cost and income tax?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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How much was the net profit before finance cost and income tax?
ter 4- Preparing the Financial Statements
3 The adjusted trial balance of Stratosphere Company includes the
following accounts at December 31, 2019:
5,000,000
28,000
180,000
520,000
2,800,000
500,000
720,000
110,000
800,000
16,000
100,000
400,000
Sales revenue
Commission income
Interest expense
Inventory, December 31, 2019
Purchases (net of returns)
Sales commissions
Administrative salaries
Office supplies expense
Dividends declared
Dividend income
Gain on sale of equipment
Rent expense
Unrealized gain on investments at fair value
through profit or loss
Unrealized gain on investments at fair value
through other comprehensive income
Depreciation expense-store equipment
Depreciation expense-office equipment
Freight-in
Freight-out
55,000
88,000
70,000
50,000
80,000
120,000
Additional information:
(1)
(2)
(3)
Merchandise inventory, January 1, 2019, P450,000.
Income tax rate is 30%.
Rent expense is allocated 60% to selling and 40% to
administrative.
How much was the profit before finance cost and income tax?
a.
P2 100 000
Transcribed Image Text:ter 4- Preparing the Financial Statements 3 The adjusted trial balance of Stratosphere Company includes the following accounts at December 31, 2019: 5,000,000 28,000 180,000 520,000 2,800,000 500,000 720,000 110,000 800,000 16,000 100,000 400,000 Sales revenue Commission income Interest expense Inventory, December 31, 2019 Purchases (net of returns) Sales commissions Administrative salaries Office supplies expense Dividends declared Dividend income Gain on sale of equipment Rent expense Unrealized gain on investments at fair value through profit or loss Unrealized gain on investments at fair value through other comprehensive income Depreciation expense-store equipment Depreciation expense-office equipment Freight-in Freight-out 55,000 88,000 70,000 50,000 80,000 120,000 Additional information: (1) (2) (3) Merchandise inventory, January 1, 2019, P450,000. Income tax rate is 30%. Rent expense is allocated 60% to selling and 40% to administrative. How much was the profit before finance cost and income tax? a. P2 100 000
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