Question

The following information is provided. Sales revenue Gain on sale of plant assets Selling and administrative expenses Cost of goods sold HK$96,000 28,800 9,600 52,800 4,800 20 % Interest expense Income tax rate Determine (a) Income from operations HK$ (b) Income before income tax HK$ (c ) Net income HK$

Answer 1

1.

Income Statement Sales Revenue Less: Cost of Goods Sold Gross Margin Less: Selling and administrative expense Income from Operations Add: Gain on sale of plant Income before Interest and Tax Less: Interest Expnese Income before Income Tax Less Income tax @20% Net Income $96,000 ($52,800) $43,200 ($9,600) $33,600 $28,800 $62,400 ($4,800) $57,600 ($11,520) $46,080

2.

Blossom's 2022 Earning per Share $4.66

Working:

Net Income Less: Prefrence Dividend Paid Net Income availabe for common shareholders (A) No. of Ordinary shares outstanding (B) Earning per Share (A/B) $1,196,600 ($278,580) $918,020 197000 $4.66

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