Task: Multiple-step income statement.
Presented below is information related to Gregg Company.
Retained earnings, December 31, 2005 $ 650,000
Sales 1,600,000
Selling and administrative expenses 240,000
Hurricane loss (pre-tax) on plant (extraordinary item) 250,000
Cash dividends declared on common stock 33,600
Cost of goods sold 960,000
Gain resulting from computation error on depreciation charge in 2004 (pre-tax) 520,000
Other revenue 60,000
Other expenses 50,000
Instructions:
Prepare in good form a multiple-step income statement for the year 2005. Assume a 30% tax rate and that 100,000 shares of common stock were outstanding during the year.