Selected information about income statement accounts
for the Reed Company is presented below (the
company's fiscal year ends on December 31):
2021 2020
Sales $ 4,400,000 $ 3,500,000
Cost of goods sold 2,860,000 2,000,000
Administrative expenses 800,000 675,000
Selling expenses 360,000 302,000
Interest revenue 150,000 140,000
Interest expense 200,000 200,000
Loss on sale of assets of discontinued component 48,000 —
On July 1, 2021, the company adopted a plan to discontinue a
division that qualifies as a component of
an entity as defined by GAAP. The assets of the component were sold
on September 30, 2021, for $48,000
less than their book value. Results of operations for the component
(included in the above account
balances) were as follows:
1/1/12021-9/30/2021 , 2020
Sales $ 400,000 $ 500,000
Cost of goods sold (290,000) (320,000)
Administrative expenses (50,000) (40,000)
Selling expenses (20,000) (20,000)
Operating income before taxes $ 40,000 $ 120,000
In addition to the account balances above, several
events occurred during 2021 that have not yet been
reflected in the above accounts:
1. A fire caused $50,000 in uninsured damages to the main office
building. The fire was considered to be
an infrequent but not unusual event.
2. Inventory that had cost $40,000 had become obsolete because a
competitor introduced a better product.
The inventory was sold as scrap for $5,000.
3. Income taxes have not yet been recorded.
Required:
Prepare a multiple-step income statement for the Reed
Company for 2021, showing 2020 information in comparative format,
including income taxes computed at 25% and EPS disclosures assuming
300,000 shares of common stock. (Amounts to be deducted should be
indicated with a minus sign. Round EPS answers to 2 decimal
places.)
The income statement is prepared as follows:
Resulting excel sheet is as follows:
Note: All the amounts are calculated in the excel sheet.
Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal...
Selected information about income statement accounts for the Reed Company is presented below the company's fiscal year ends on December 31): Sales revenue Cost of goods sold Administrative expense Selling expense Interest revenue Interest expense Loss on sale of assets of discontinued component 2021 $4,800,000 2,940,000 880,000 440,000 158,000 216,000 80,000 2020 $3,900,000 2,080,000 755,000 382,000 148,000 216,000 On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of an entity as...
Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31): points Sales revenue Cost of goods sold Administrative expense Selling expense Interest revenue Interest expense Loss on sale of assets of discontinued component 2021 2020 $4,550,000 $3,650,000 2,890,000 2,030,000 830,000 705,000 390,000 332,000 153,000 143,000 206,000 206,000 60,000 eBook Print On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of...
Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31): Sales revenue Cost of goods sold Administrative expense Selling expense Interest revenue Interest expense Loss on sale of assets of discontinued component 2021 $4,950,000 2,970,000 910,000 470,000 161,000 222,000 92,000 2020 $4,050,000 2,110,000 785,000 412,000 151,000 222,000 On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of an entity as...
Selected information about Income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31): Sales revenue Cost of goods sold Administrative expense Selling expense Interest revenue Interest expense Loss on sale of assets of discontinued component 2021 $4,550,000 2,890,000 830,000 390,000 153,000 206,000 60,000 2020 $3,650,000 2,030,000 705,000 332,000 143,000 206,000 On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of an entity as...
Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31) Sales revenue Cost of goods sold Administrative expense Selling expense Interest revenue Interest expense Loss on sale of assets of discontinued component 2021 2020 $5,250,000 $4,350,000 3,030,000 2,170,000 970,000 845,000 530,000 472,000 167,000 157,000 234,000 234,000 116,000 On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of an entity as...
please complete income statement Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31): Sales revenue Cost of goods sold Administrative expense Selling expense Interest revenue Interest expense Loss on sale of assets of discontinued component 2021 $4,600,000 2,900,000 840,000 400,000 154,000 208,000 64,000 2020 $3,700,000 2,040,000 715,000 342,000 144,000 208,000 On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component...
Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31): 2021 2020 Sales revenue $ 4,900,000 $ 4,000,000 Cost of goods sold 2,960,000 2,100,000 Administrative expense 900,000 775,000 Selling expense 460,000 402,000 Interest revenue 160,000 150,000 Interest expense 220,000 220,000 Loss on sale of assets of discontinued component 88,000 — On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of...
Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31): Sales revenue Cost of goods sold Administrative expense Selling expense Interest revenue Interest expense Loss on sale of assets of discontinued component 2021 2020 $5,eee, eee $4,100,000 2,980,000 2,120,000 920,800 795,000 488,800 422,000 162,000 152,000 224,000 224,000 96,000 On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of an entity...
Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31): 2021 2020 Sales revenue $ 5,100,000 $ 4,200,000 Cost of goods sold 3,000,000 2,140,000 Administrative expense 940,000 815,000 Selling expense 500,000 442,000 Interest revenue 164,000 154,000 Interest expense 228,000 228,000 Loss on sale of assets of discontinued component 104,000 — On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of...
Selected information about income statement accounts for the Reed Company is presented below the company's flscal year ends on December 31) Sales revenge Coat of goods sold Administrative expense Selling expense Interest revenue Internet expense Los on sale of sata of discontinued component 94,800,000 $3,000,000 2.940,000 2.000.000 880,000 755,000 440,000 382,000 158,000 140,000 216.000 216,000 80,000 On July 1 2021, the company adopted a plan to discontinue a division that qualfles as a component of an entity as defined by...