Student Name:
Class:
2016 2015
4,000,000$ 3,000,000$
2,570,000 1,680,000
1,430,000 1,320,000
750,000 635,000
340,000 282,000
Problem 04-01
McGraw-Hill/Irwin
Instructor
for the Years Ended December 31
Comparative Income Statements
REED COMPANY
Selling
Sales revenue
Cost of goods sold
Gross profit
Operating expenses:
Administrative
Income tax benefit (expense)
Income (loss) on discontinued operations
Operating income
Loss from fire damage
Loss from write-down of obsolete inventory
Total operating expenses
component (including loss on disposal of
Other income (expense):
Interest revenue
Interest expense
Total other expenses (net)
Income from continuing operations before
income taxes
Income tax expense
Income from continuing operations
Income (loss) from operations of discontinued
Income from continuing operations
Discontinued operations
Earnings per share:
2016 2015
4,400,000$ 3,500,000$
2,860,000 2,000,000
1/1/13 –
9/30/16 2015
Uninsured damage due to fire
Cost of obsolete inventory
Administrative expense
Selling expenses
Obsolete inventory sold for scrap
Income tax rate
Common stock shares
400,000$ 500,000$
(290,000) (320,000)
Given Data P04-01:
Sales
Cost of goods sold
Results of operations for discontinued component (included above):
Sales
Cost of goods sold
Administrative expenses
Selling expenses
Interest revenue
Interest expense
Loss on sale of assets of discontinued component
Student Name:
Class:
income taxes
Total operating expenses
Operating income
Other income:
Interest revenue
Gain on sale of investments
Total other income
Income from continuing operations before
Income from continuing operations
Discontinued operations
Income tax expense
Discontinued operations
Income on discontinued operations
Earnings per share:
425$
128$
26
McGraw-Hill/Irwin
Instructor
For the Year Ended December 31, 2016
Income Statement
ALEXIAN SYSTEMS, INC.
Problem 04-05
($ in millions, except earnings per share)
Net sales revenue
Operating expenses:
Selling and administrative
Restructuring costs
Cost of goods sold
Gross profit
425$
Other income gain from sale of investments
Other income from a discontinued operation.
Cost of goods sold increase to correct
error in 2015 ending inventory
Income tax rate
Outstanding shares of common stock
26$
Given Data P04-05:
($ in millions, except earnings per share)
for the Year Ended December 31, 2016
Income Statement
ALEXIAN SYSTEMS, INC.
Revenues and gains:
Net sales
Additional information ($ in millions):
Selling and administrative expenses include
restructuring costs
Interest
Other income
Total revenues and gains
Cost of goods sold
Selling and administrative
Income taxes
Total expenses
Net income
Student Name:
Class:
18,000$
10,500
7,500$
400
120
280
Income from discontinued operations
Earnings per share:
Problem 04-06
McGraw-Hill/Irwin
Instructor
For the year ended December 31, 2016
Income Statement
REMBRANDT PAINT COMPANY
($ in thousands, except per share amounts)
Sales revenue
Cost of goods sold
Gross profit
Operating expenses:
Discontinued operations:
Income from operations of discontinued component
Income tax expense
Income on discontinued operations
Selling and administrative
Restructuring costs
Operating income
Interest income (expense), net
Income from continuing operations before income taxes
Income tax expense
Income from continuing operations
REMBRANDT PAINT COMPANY
Gain on disposal of component’s assets
Shares of common stock outstanding in 2016
Income tax rate
18,000$
1,600,000$
Given Data P04-06:
Income statement items,
year ended 12/31/2016 ($ in thousands):
Net sales
Loss from operations on plastics business
Interest income
Interest expense
Cost of goods sold
Selling and administrative expenses
Restructuring costs
Student Name:
Class:
Other comprehensive income (loss):
Income tax expense
Net income
Unrealized gain on investment securities, net of tax
Total other comprehensive loss
15,000,000$
(700,000)
3,100,000
Problem 04-08
McGraw-Hill/Irwin
Instructor
For the Year Ended December 31, 2016
Statement of Comprehensive Income
DUKE COMPANY
Sales revenue
Other income (expense):
Interest expense
Income before income taxes
Total operating expenses
Cost of goods sold
Gross profit
Operating expenses:
General and administrative
Selling
Restructuring costs
Loss from write-down of obsolete inventory
Operating income
Cost of goods sold
General and administrative expenses
Selling expenses
Interest expense
300,000$
Restructuring costs due to plant closings
Given Data P04-08:
December 31, 2016 Account Balances
DUKE COMPANY
Additional information:
Effective tax rate
Inventory written off as obsolete
Understatement of 2015 depreciation expense
Foreign currency translation adjustment loss
Unrealized gain on investment securities