Question

W FUNCIES Current Attempt in Progress The following information is related to Splish Company for 2020. Retained earnings balance, January 1, 2020 Sales Revenue Cost of goods sold Interest revenue Selling and administrative expenses Write-off of goodwill Income taxes for 2020 Gain on the sale of investments Loss due to flood damage Loss on the disposition of the wholesale division (net of tax) Loss on operations of the wholesale division (net of tax) Dividends declared on common stock Dividends declared on preferred stock $1,332,800 34,000,000 21.760,000 95,200 6,392,000 1.115,200 1,691,840 149,600 530,400 598,400 122,400 340,000 108,800 Splish Company decided to discontinue its entire wholesale operations (considered a discontinued operation) and to retain its manufacturing operations. On September 15, Splish sold the wholesale operations to Rogers Company. During 2020, there were 500.000 shares of common stock outstanding all year. (a 1) Prepare a multiple-step income statement. (Round earnings per share to 2 decimal places. 1.490 SPLISH COMPANY U

Answer 1

SPLISH COMPANY
Income Statement
Sep-15
Revenues
Sales revenue		34,000,000
Cost of goods sold		-21,760,000
Gross profit		12,240,000
Operating expenses:
Selling and administrative expenses	6,392,000
Total Operating expenses		-6,392,000
Operating Profit		5,848,000
Other revenues:
Interest revenue	95,200
Gain on the sale of investments	149,600
Other expenses:
Write-off of goodwill	-1,115,200
Loss due to flood damage	-530,400
		-1,400,800
Profit before tax		4,447,200
Income tax expense		-1,691,840
Net Income from continuing operations		2,755,360
Discontinued operations:
Loss on the disposition of the wholesale division		-598,400
Loss on operations of the wholesale division		-122,400
Net Income		$2,034,560
Earning per share { ( Net Income-preferred dividend( / Number of common shares) {( 2,034,560-108,800)/500,000)		$             3.85

SPLISH COMPANY
Retained Earnings Statement
At September 15
Beginning retained earnings		1,332,800
Add: Net income		2,034,560
		3,367,360
Less:Dividends- common stock	-340,000
Less:Dividends- Preferred stock	-108,800
		-448,800
Retained earnings, Ending		$2,918,560

Kindly comment if you need further assistance. Thanks‼!