Reference no: EM133035143

Question - Following summarized data were provided by the records of sleep Inc. for the year ended December 31, 2020:

Sales of merchandise for cash - $229,000

Sales of merchandise on credit - 36,500

Cost of sales 156,000 selling expenses - 41,100 Administrative expenses - 19,900

Sales returns and allowances - 7900

Bad expense - 730

Items not included in the above amounts:

Average income tax rate, 40%

Number of common shares outstanding, 3,000

Required -

1. Based on these data, prepare a multiple-step statement of earnings (showing both gross profit/(loss) and earnings from operations). Round "earnings per share" to two decimal places.)

2. Compute the amount of gross profit/(loss) in a gross profit/(loss) percentage.