Question

Carson Corporation provided the following​ partial-trial balance for the current year. Prepare a statement of net...

Carson Corporation provided the following​ partial-trial balance for the current year.

Prepare a statement of net income and additional disclosures that would meet IFRS requirements. Indicate items that IFRS requires be reported on the statement of net income.

Carson is subject to a 40​% income tax rate. Use the condensed format

Carson Corporation

Trial Balance (Selected Accounts)

For the Year Ended December 31

Account

Debit

Credit

Dividends

$1,330

Sales

$190,000

Dividend Income

550

Interest Income

1,200

Gain on Disposal of Plant Assets

1,300

Unrealized Gain on Trading Investments

2,400

Cost of Goods Sold

44,000

Office Supplies Expense

5,000

Sales Salaries Expense

4,300

Selling Expenses

17,000

Accounting and Legal Fees—General Expense

760

Advertising Expense

4,200

Office Salaries Expense

6,300

Depreciation Expense—General Expense

9,200

Interest Expense

2,700

Loss on Asset Impairment

2,300

Carson Corporation

Statement of Profit and Loss

Required

For the Year Ended December 31

Disclosure

Less:

Net Profit

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Answer #1
Carson Corporation
Statement of Profit and Loss
For the Year Ended December 31
Sales $190,000
Less: Cost of Goods Sold ($44,000)
Gross Profit $146,000
Less: Operating Expenses:
Office supplies expense ($5,000)
Sales salaries expense ($4,300)
Selling expense ($17,000)
Accounting and legal fees - General expense ($760)
Advertising expense ($4,200)
Office salaries expense ($6,300)
Depreciation expense - General Expense ($9,200)
Interest expense ($2,700)
Loss on asset impairment ($2,300)
Add: Operating Income:
Dividend income $550
Interest income $1,200
Gain on Disposal of plant assets $1,300
Profit before tax $97,290
Less: Income tax ($97,290*40/100) ($38,916)
Net Profit after Tax $58,374
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