Problem - Earnings per Share and Multiple-Step Income Statement
The following summarized data relate to Bowden Corporation's current operations:
Sales revenue - $760,000
Cost of goods sold - 450,000
Selling expenses - 65,000
Administrative expenses (considered unusual and infrequent) - 72,000
Loss on sale of equipment - 5,000
Income tax expense [not allocated) - 42,000
Shares of common stock
Outstanding at January 1 - 20,000 shares
Additional issued at May 1 - 7,000 shares
Additional issued at November 1 - 2,000 shares
Required - Prepare a multiple-step income statement for Bowden Corporation for the year. Assume a 25 percent income tax rate. Allocate income tax expense within the income statement. Include earnings per share disclosure at the bottom of the income statement.