Question

Financial statement data for Crawford Crafts, Inc. are given below. All figures are in dollars. Use this data to construct an Income Statement for the year ending December 31, 2018 and use your constructed statement to answer the following 4 questions. Advertising 118,700 Beginning of year inventory 2,341,500 Depreciation 350,200 End of year inventory 2,245,900 General and administrative expenses 634.200 Gross sales 14,201,400 Interest expense 238,100 120,300 Lease payments 1,833,200 Management salaries 10.240,300 Purchases 124,500 Research and development 21,800 Returns and allowances 181,200 Taxes 1. What was gross profit from income statement for the year ending December 31, 2018? 2. What was operating profit (i.e., EBIT) from Crawford Crafts income statement for the year ending December 31, 2018? 3. What was profit before taxes (i.e., EBT) from Crawford Crafts income statement for the year ending December 31, 2018? 4. What was net income from Crawford Crafts income statement for the year ending December 31, 2018? ner share on a total of 138,400 share

Answer 1

Crawford Crafts Inc.
Income statement
For the period Dec 31, 2018	amount ($)
gross sales		14201400
less:return and allowances		181200
net sales		14020200
cost of goods sold:
opening inventory	2341500
add:purchases	10240300
cost of goods available	12581800
less:closing inventory	-2245900
less:cost of goods sold		10335900
gross profit		3684300
less:operating expenses
advertising		118700
depreciation		350200
general and administrative expense		634200
lease payments		120300
management salaries		1833200
research and development		124500
operating profit (EBIT)		503200
less:interest expense		238100
profit before tax (EBT)		265100
less:tax		181200
net income		83900
		amount ($)
gross profit		3684300
operating profit (EBIT)		503200
profit before tax (EBT)		265100
net income		83900