Reference no: EM132840936
Below are information taken from the December 31, 2020 profit or loss section of Manda Company;
Sales: $9,000,000
Cost of goods sold: $5,400,000
Operating expenses: $900,000
Gain on Sale of equipment: $100,000
Income Tax: $840,000
1.) The income tax rate is 30%
2.) Third quarter sales were 30% of total sales
3.) For interim reporting purposes, a gross profit rate of 40% can be justified.
4.) Of the total operating expenses, $600,000 are variable.
5.) Variable operating expenses are directly related to sales revenue, while fixed operating expenses are allocated based on the expiration of time.
6.) The equipment was sold on July 31, 2020
Requirement:
Problem 1: Reconstruct the profit or loss portion of the statement of comprehensive income for the third quarter.