Solution-Prepare a multiplc-step income statement

Prepare a multiplc-step income statement

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Reference no: EM13494583

Porter Corporation's capital structure consists of 50,000 shares of common stock. At December 31. 2010 an analysis of the accounts and discussions with company officials revealed the following information:

Sales	$1,100,000
Purchase discounts	18,000
Purchases	642,000
Earthquake loss (net of tax) (extraordinary item)	42,000
Selling expenses	128,000
Cash	60,000
Accounts receivable	90,000
Common stock	200,000
Accumulated depreciation	180,000
'Dividend revenue	8,000
Inventory, January 1, 2010	152,000
Inventory, December 31, 2010	125,000
Unearned service revenue	4,400
Accrued interest payable	1,000
1.aml	370,000
Patents	100,000
Retained earnings, January 1, 2010	290,000
Interest expense	17,000
General and administrative expenses	150,000
Dividends declared	29,000
Allowance for doubtful accounts	5,000
Notes payable (maturity 7/1113)	200,000
Machinery and equipment	450,000
/Materials and supplies	40,000
Accounts payable	60,000

The amount of income taxes applicable to ordinary income was $48,600, excluding the tax effect of the earthquake loss which amounted to $18,000.

Instructions

(a) Prepare a multiplc-step income statement.

(b) Prepare a retained earnings statement.

Reference no: EM13494583

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Prepare a multiplc-step income statement

Reference no: EM13494583

Reference no: EM13494583

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