Question

Marigold Corporation had net sales of $2,400,900 and interest revenue of $37,400 during 2020. Expenses for 2020 were cost of goods sold $1,466,300, administrative expenses $221,700, selling expenses $298,700, and interest expense $45,300. Marigold’s tax rate is 30%. The corporation had 100,000 shares of common stock authorized and 74,370 shares issued and outstanding during 2020. Prepare a single-step income statement for the year ended December 31, 2020. (Round earnings per share to 2 decimal places, e.g. 1.48.)

Create an Income Statement

Answer 1

MARIGOLD CORPORATION

INCOME STATEMENT

Particulars	$	$
Net Sales	2,400,900
Less: Cost of goods sold	(1,466,300)
Gross Profit		$934,600
Less: Operating Expenses
Selling Expenses		(298,700)
Administrative Expenses		(221,700)
Income from Operations		$414,200
+/- Other Revenue and Gains, Expenses and Losses
Add : Interest Revenue		37,400
Less : Interest Expense		(45,300)
Income before Income Tax		$406,300
Less: Income Tax Expense @30%		(121,890)
Net Income		$284,410
Earnings Per Share		$5.46
( Net Income / Outstanding shares)

Note :

EPS = Net Income ÷ Outstanding Shares

= $406,300 ÷ 74,370 shares

= 5.463224

= $5.46 (approx.)