The following information is taken from the draft financial statement of Northstar Corp. at their December...
The following information is taken from the draft financial statement of Northstar Corp. at their December 31, 2015 year end.
- Income from continuing operations before taxes is $5,050,000.
- The average tax rate for the company is 30%.
- There are 130,000 common shares outstanding.
- Northstar Corp. follows IFRS.
Additional transactions which are not included in the above figures are as follows:
- Obsolete inventory was written off for $455,000.
- A prior period lawsuit, which had been deemed unlikely and unestimable, was settled and the company received $310,000.
- Equipment costing $690,000, with a book value of $258,000 was sold for $301,000.
- Disposal of a division generated a $210,000 loss before tax.
- The fair value of Available for Sale (AFS) investments increased by a pre-tax amount of $16,000.
- An underestimation of bad debts from 2013 totalling $2,000 was found and charged to retained earnings. This was due to a calculation error.
Please make sure your final answers are accurate to the nearest
whole number unless otherwise stated.
a) Calculate income before tax and discontinued operations.
Income = $
b) Calculate net income before discontinued operations.
Net income = $
c) Calculate net income.
Net income = $
d) Calculate comprehensive income/loss.
Comprehensive income (loss) = $
e) Calculate earnings per common share (EPS) from net income.
Please make sure your final answer(s) are accurate to 2 decimal
places.
Homework Answers
| Financial Statement of NorthStar Corp | |||||
| Dec 31, 2015 | Amnt$ | ||||
| Income From Continuing Operation before Tax | 50,50,000 | ||||
| Avaerage tax rate | 30% | ||||
| Common Share OS | 130000 | ||||
| Income From Continuing Operation before Tax | 50,50,000 | ||||
| LESS -Adjusted following Item in PNL ( charge ) | Amnt$ | ||||
| Obsolete InventOry W/OFF | 4,55,000 | ||||
| Earlier Law Suit - deemed Unlikely | |||||
| and Unestimable - Settelement | 3,10,000 | ||||
| Equipment net position ( LOSS ON Sales ) | |||||
| Amnt$ | |||||
| Books Value | 258000 | ||||
| Less- | |||||
| Sale Value | 301000 | ||||
| Loss on Sale of Asset | -43000 | 43,000 | |||
| Earlier Bad debt from 2013 | |||||
| not accounted earleir - Now charged of | 2,000 | ||||
| Adjusted total Item | 8,10,000 | ||||
| Net Income before adjustment of Discontinue Operation | 42,40,000 | A | |||
| Less tax on above 30% * $ 4240000 | 12,72,000 | B | |||
| Net Income after tax before adjustment of Discontinue Operation | 29,68,000 | (A-B)=C | |||
| Less - Net of tax Loss from Discontinued Operation | |||||
| Disposal of division generated $ 210000( loss before Tax) | |||||
| Post tax loss $210000*70% | 147000 | ||||
| Net Income available to Equity Shareholders | 28,21,000 | ||||
| EPS calculation | |||||
| Net Income available to Equity Shareholders | 28,21,000 | A1 | |||
| Number of shares OS | 130000 | B1 | |||
| EPS(A1/B1) | 21.70 | ||||
| Ans a) | Calculate income before tax and discontinued operations. | ||||
| Income = $ | 42,40,000 | ||||
| Ans b) | Calculate net income before discontinued operations. | 29,68,000 | |||
| Net income = $ | |||||
| Ans c) | Calculate net income. | 28,21,000 | |||
| Net income = $ | |||||
| Ans d) | Calculate comprehensive income/loss. | Comprehensive Income /LOSS would be | |||
| Comprehensive income (loss) = $ | The fair value of avaiable for sale (AFS) | ||||
| increased by Pre Tax amount $ 16000 | |||||
| So Comprehensive Gain by $ 16000 | |||||
| Ans e) |
Calculate earnings per common share (EPS) from net income. Please make sure your final answer(s) are accurate to 2 decimal places. |
21.70 | |||
Add Answer to:
The following information is taken from the draft financial
statement of Northstar Corp. at their December...
Northstar Corp.'s income statement and balance sheet are given below. a) Express this information as vertical...
Northstar Corp.'s income statement and balance sheet are given below. a) Express this information as vertical trend percents. Please make sure your final answer(s) are in percentage form and are accurate to 2 decimal places. (For example: 12.34%) Northstar Corp Income Statement Vertical Trend Percentages (%) 2016 2015 2014 2016 2015 2014 Sales $1,428,000 $1,202,000 $1,059,000 Cost of goods sold. 974,000 858,000 773,000 Gross profit from sales 454,000 344,000 286,000 Operating expenses. 290,000 235.000 194.000 Income before tax 164,000 109,000...
The following information was taken from the records of Sheffield Inc. for the year 2020: Income...
The following information was taken from the records of Sheffield Inc. for the year 2020: Income tax applicable to income from continuing operations $209,440; income tax applicable to loss on discontinued operations $28,560, and unrealized holding gain on available-for-sale securities (net of tax) $16,800. Gain on sale of equipment Loss on discontinued operations Administrative expenses Rent revenue Loss on write-down of inventory $106,400 84,000 268,800 44,800 67,200 Cash dividends declared Retained earnings January 1, 2020 Cost of goods sold Selling...
The following pretax amounts are taken from the adjusted trial balance of Avoca Auto Corp. at...
The following pretax amounts are taken from the adjusted trial balance of Avoca Auto Corp. at December 31, 2020, its annual year-end. Sales revenue $260,000 Cost of goods sold 110,000 Operating expenses 80,000 Gain on debt retirement 20,000 Interest expense 8,000 Loss from discontinued operations 50,000 Retained earnings balance, December 31, 2019 30,000 Dividends declared and paid 25,000 Unrealized holding gain on debt investment securities, net of tax 4,000 Common stock, weighted average shares outstanding 10,000 shares Required a. Prepare...
For its fiscal year ending October 31, 2022. Bridgeport Corp. reports the following partial data shown...
For its fiscal year ending October 31, 2022. Bridgeport Corp. reports the following partial data shown below. Income before income taxes $448,200 Income tax expense (20% * $348,600) 69.720 Income from continuing operations 378.480 Loss on discontinued operations 99,600 Net income $278.880 The loss on discontinued operations was comprised of a $41,500 loss from operations and a $58.100 loss from disposal. The income tax rate is 20% on all items. Prepare a correct statement of comprehensive income, beginning with income...
Wildhorse Corp. has 150,620 shares of common stock outstanding. In 2020, the company reports income from...
Wildhorse Corp. has 150,620 shares of common stock outstanding. In 2020, the company reports income from continuing operations before income tax of $1,221,000. Additional transactions not considered in the $1,221.000 are as follows. 1. In 2020, Wildhorse Corp. sold equipment for $35,800. The machine had originally cost $84,300 and had accumulated depreciation of $33,900. The gain or loss is considered non-recurring. 2. The company discontinued operations of one of its subsidiaries during the current year at a loss of $191,200...
Return to The following are partial income statement account balances taken from the December 31, 2021....
Return to The following are partial income statement account balances taken from the December 31, 2021. year-end trial balance of White and Sons, Inc.: restructuring costs, $470,000; interest revenue, $57,000, before tax loss on discontinued operations, $570,000; and loss on sale of investments, $67,000. Income tax expense has not yet been recorded. The income tax rate is 25% Prepare the lower portion of the 2021 income statement beginning with $885,000 income from continuing operations before income taxes. Include appropriate EPS...
The following information was taken from the records of Metlock Inc. for the year 2020: Income...
The following information was taken from the records of Metlock
Inc. for the year 2020: Income tax applicable to income from
continuing operations $183,260; income tax applicable to loss on
discontinued operations $24,990, and unrealized holding gain on
available-for-sale securities (net of tax) $14,700.
Gain on sale of equipment
$93,100
Cash dividends declared
$147,000
Loss on discontinued operations
73,500
Retained earnings January 1, 2020
1,560,000
Administrative expenses
235,200
Cost of goods sold
833,000
Rent revenue
39,200
Selling expenses
294,000
Loss...
Exercise 13-01 For its fiscal year ending October 31, 2022, Bramble Corp, reports the following partial...
Exercise 13-01 For its fiscal year ending October 31, 2022, Bramble Corp, reports the following partial data shown below. Income before income taxes Income tax expense (20% x 5436,800) Income from continuing operations Loss on discontinued operations Net Income $561,600 87,360 474,240 124.800 $349,440 The loss on discontinued operations was comprised of a $52,000 loss from operations and a $72,000 loss from disposal. The income tax rate is 20% on all items. Prepare a correct statement of comprehensive income, beginning...
Swifty Corp. has 149,190 shares of common stock outstanding. In 2020, the company reports income from...
Swifty Corp. has 149,190 shares of common stock outstanding. In
2020, the company reports income from continuing operations before
income tax of $1,211,100. Additional transactions not considered in
the $1,211,100 are as follows.
1.
In 2020, Swifty Corp. sold
equipment for $37,400. The machine had originally cost $84,500 and
had accumulated depreciation of $32,900. The gain or loss is
considered non-recurring.
2.
The company discontinued
operations of one of its subsidiaries during the current year at a
loss of $194,600...
Exercise 18-02 Trayer Corporation has income from continuing operations of $256,000 for the year ended December...
Exercise 18-02 Trayer Corporation has income from continuing operations of $256,000 for the year ended December 31, 2020. It also has the following items (before considering income taxes). 1. An unrealized loss of $86,000 on available-for-sale securities. 2. A gain of $32,000 on the discontinuance of a division (comprised of a $18,000 loss from operations and a $50,000 gain on disposal). Assume all items are subject to income taxes at a 25% tax rate. Prepare a statement of comprehensive income,...
Northstar Corp.'s income statement and balance sheet are given below. a) Express this information as vertical trend percents. Please make sure your final answer(s) are in percentage form and are accurate to 2 decimal places. (For example: 12.34%) Northstar Corp Income Statement Vertical Trend Percentages (%) 2016 2015 2014 2016 2015 2014 Sales $1,428,000 $1,202,000 $1,059,000 Cost of goods sold. 974,000 858,000 773,000 Gross profit from sales 454,000 344,000 286,000 Operating expenses. 290,000 235.000 194.000 Income before tax 164,000 109,000...
The following information was taken from the records of Sheffield Inc. for the year 2020: Income tax applicable to income from continuing operations $209,440; income tax applicable to loss on discontinued operations $28,560, and unrealized holding gain on available-for-sale securities (net of tax) $16,800. Gain on sale of equipment Loss on discontinued operations Administrative expenses Rent revenue Loss on write-down of inventory $106,400 84,000 268,800 44,800 67,200 Cash dividends declared Retained earnings January 1, 2020 Cost of goods sold Selling...
The following pretax amounts are taken from the adjusted trial balance of Avoca Auto Corp. at December 31, 2020, its annual year-end. Sales revenue $260,000 Cost of goods sold 110,000 Operating expenses 80,000 Gain on debt retirement 20,000 Interest expense 8,000 Loss from discontinued operations 50,000 Retained earnings balance, December 31, 2019 30,000 Dividends declared and paid 25,000 Unrealized holding gain on debt investment securities, net of tax 4,000 Common stock, weighted average shares outstanding 10,000 shares Required a. Prepare...
For its fiscal year ending October 31, 2022. Bridgeport Corp. reports the following partial data shown below. Income before income taxes $448,200 Income tax expense (20% * $348,600) 69.720 Income from continuing operations 378.480 Loss on discontinued operations 99,600 Net income $278.880 The loss on discontinued operations was comprised of a $41,500 loss from operations and a $58.100 loss from disposal. The income tax rate is 20% on all items. Prepare a correct statement of comprehensive income, beginning with income...
Wildhorse Corp. has 150,620 shares of common stock outstanding. In 2020, the company reports income from continuing operations before income tax of $1,221,000. Additional transactions not considered in the $1,221.000 are as follows. 1. In 2020, Wildhorse Corp. sold equipment for $35,800. The machine had originally cost $84,300 and had accumulated depreciation of $33,900. The gain or loss is considered non-recurring. 2. The company discontinued operations of one of its subsidiaries during the current year at a loss of $191,200...
Return to The following are partial income statement account balances taken from the December 31, 2021. year-end trial balance of White and Sons, Inc.: restructuring costs, $470,000; interest revenue, $57,000, before tax loss on discontinued operations, $570,000; and loss on sale of investments, $67,000. Income tax expense has not yet been recorded. The income tax rate is 25% Prepare the lower portion of the 2021 income statement beginning with $885,000 income from continuing operations before income taxes. Include appropriate EPS...
The following information was taken from the records of Metlock
Inc. for the year 2020: Income tax applicable to income from
continuing operations $183,260; income tax applicable to loss on
discontinued operations $24,990, and unrealized holding gain on
available-for-sale securities (net of tax) $14,700.
Gain on sale of equipment
$93,100
Cash dividends declared
$147,000
Loss on discontinued operations
73,500
Retained earnings January 1, 2020
1,560,000
Administrative expenses
235,200
Cost of goods sold
833,000
Rent revenue
39,200
Selling expenses
294,000
Loss...
Exercise 13-01 For its fiscal year ending October 31, 2022, Bramble Corp, reports the following partial data shown below. Income before income taxes Income tax expense (20% x 5436,800) Income from continuing operations Loss on discontinued operations Net Income $561,600 87,360 474,240 124.800 $349,440 The loss on discontinued operations was comprised of a $52,000 loss from operations and a $72,000 loss from disposal. The income tax rate is 20% on all items. Prepare a correct statement of comprehensive income, beginning...
Swifty Corp. has 149,190 shares of common stock outstanding. In
2020, the company reports income from continuing operations before
income tax of $1,211,100. Additional transactions not considered in
the $1,211,100 are as follows.
1.
In 2020, Swifty Corp. sold
equipment for $37,400. The machine had originally cost $84,500 and
had accumulated depreciation of $32,900. The gain or loss is
considered non-recurring.
2.
The company discontinued
operations of one of its subsidiaries during the current year at a
loss of $194,600...
Most questions answered within 3 hours.
-
How many ways can 2 people be chosen and arranged in a straight
line if there...
asked 39 minutes ago -
(Problem 1d). Leandro has 16 hours per day that he can allocate
to work or leisure....
asked 1 hour ago -
Morganton Company
makes one product and it provided the following information to help
prepare the master...
asked 1 hour ago -
2Al + 3Cl2 --> 2AlCl3
If one mole Al is reacted w two moles Cl2, how...
asked 2 hours ago -
1. You will see some trends in the movement of each currency vs.
the US Dollar....
asked 2 hours ago -
9. (9 pts) An investor with a stock portfolio worth several
hundred thousand dollars sued his...
asked 3 hours ago -
Which statement is true?
a. Unless directed otherwise, the computer automatically
executes C. statements one before...
asked 3 hours ago -
When a new company is considering Speed to Market for a product
launch, which would provide...
asked 4 hours ago -
bacteria and their metabolites could either promote or protect from
cancer. Explain one of these cases...
asked 4 hours ago -
Use the sample data and confidence level given below to complete
parts (a) through (d).
A...
asked 4 hours ago -
During laser vision correction, a brief burst of 193 nm
ultraviolet light is projected onto the...
asked 4 hours ago -
1 ) How well does the initial speed, v0,calculated from Equation
4 agree with the value...
asked 4 hours ago