Prepare in good form an income statement for Franklin Kite Co. Take your calculations all the way to computing earnings per share. Sales $900,000 Shares outstanding 50,000 Cost of goods sold 400,000 Interest expense 40,000 Selling and administrative expense 60,000 Depreciation expense 20,000 Preferred stock dividends 80,000 Taxes 50,000 Solution Problem 2-8 Instructions Enter data and formulas to complete the Income Statement template below. Franklin Kite Co. Income Statement Sales Cost of goods sold Gross profit FORMULA Selling and administrative expense Depreciation expense Operating profit FORMULA Interest expense Earnings before taxes FORMULA Taxes Earnings after taxes FORMULA Preferred stock dividends Earnings available to common stockholders FORMULA Shares outstanding Earnings per share FORMULA

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question


Prepare in good form an income statement for Franklin Kite Co. Take your calculations all the way to
computing earnings per share.

Sales		$900,000
Shares outstanding		50,000
Cost of goods sold		400,000
Interest expense		40,000
Selling and administrative expense	60,000
Depreciation expense	20,000
Preferred stock dividends	80,000
Taxes		50,000


Solution
Problem 2-8
Instructions

Enter data and formulas to complete the Income Statement template below.

Franklin Kite Co.
Income Statement

Sales
Cost of goods sold
Gross profit			FORMULA
Selling and administrative expense
Depreciation expense
Operating profit			FORMULA
Interest expense
Earnings before taxes		FORMULA
Taxes
Earnings after taxes		FORMULA
Preferred stock dividends
Earnings available to common stockholders	FORMULA
Shares outstanding
Earnings per share			FORMULA

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