DEVRY ACCT 550 Week 2 Homework Assignment
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ACCT 550 Week 2 Homework Assignment
E4-4 (Multiple-Step and Single-Step) Two accountants for the firm of Allen and Wright are arguing about the merits of presenting an income statement in a multiple-step versus a single-step format. The discussion involves the following 2012 information related to Webster Company ($000 omitted).
Administrative expense
Officers’ salaries
$ 4,900
Depreciation of office furniture and equipment
3,960
Cost of goods sold
63,570
Rent revenue
17,230
Selling expense
Transportation-out
2,690
Sales commissions
7,980
Depreciation of sales equipment
6,480
Sales revenue
96,500
Income tax expense
7,580
Interest expense
1,860
Instructions
(a) Prepare an income statement for the year 2012 using the multiple-step form. Common shares outstanding for 2012 total 40,550 (000 omitted).
(b) Prepare an income statement for the year 2012 using the single-step form.
(c) Which one do you prefer? Discuss.
E4-12 (Earnings per Share) At December 31, 2011, Schroeder Corporation had the following stock outstanding.
8% cumulative preferred stock, $100 par, 107,500 shares
$10,750,000
Common stock, $5 par, 4,000,000 shares
20,000,000
During 2012, Schroeder did not issue any additional common stock. The following also occurred during 2012.
Income from continuing operations before taxes
$21,650,000
Discontinued operations (loss before taxes)
3,225,000
Preferred dividends declared
860,000
Common dividends declared
2,200,000
Effective tax rate
35%
Instructions
Compute earnings per share data as it should appear in the 2012 income statement of Schroeder Corporation. (Round to two decimal places.)
P4-1 (Multiple-Step Income, Retained Earnings) Presented below is information related to Dickinson Company...