Question

*Problem 4-1 The following information is related to Carla Company for 2017 Retained earnings balance, January 1, 2017 Sales Revenue Cost of goods sold Interest revenue Selling and administrative expenses Write-off of goodwill Income taxes for 2017 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 $997,070 26,104,600 16,185,500 78,500 4,733,500 825,900 1,405,900 116,600 397,200 450,100 84,660 263,100 77,650 Carla Company decided to discontinue its entire wholesale operations (considered a discontinued operation) and to retain its manufacturing operations. On September 15, Carla sold the wholesale operations to Rogers Company. During 2017, there were 481,300 shares of common stock outstanding all year Prepare a multiple-step income statement. (Round earnings per share to 2 decimal places, e.g. 1.49.) CARLA COMPANY ales Revenue in on the Sale of Inv ss Profit/(Loss) Selling and Administrati
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Answer 1

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Multistep Income Statement:
Sales Revenue			$ 26,104,600
Cost of Goods Sold			$-16,185,500
Gross Profit/Loss			$    9,919,100
Selling and Administrative Expense			$ -4,733,500
Income from Operations			$    5,185,600
Other Revenue and Gains:
Interest Revenue		$    78,500
Gain on Sale of Investments		$ 116,600
			$       195,100
Other Expenses and Losses:
Write-off of Goodwill		$ 825,900
Loss from flood damage		$ 397,200
			$ -1,223,100
Income from Continuing operations before income tax			$    4,157,600
Income Tax			$ -1,405,900
Income from Continuing operations			$    2,751,700
Discontinued Operations:
Loss on Disposal, Net of Tax		$ 450,100
Loss on Operations, Net of Tax		$    84,660
			$     -534,760
Net Income			$    2,216,940
Less: Preferred Dividends			$        -77,650
Income available for Common Stockholders		A	$    2,139,290
No of Common Stocks		B	481,300
Earning per Share		A/B	$             4.44
Retained Earning:
Retained Earning, January 1 2017			$       997,070
Add: Net Income			$    2,216,940
			$    3,214,010
Less:
Common Stock Dividend		$ 263,100
Preferred Stock Dividend		$    77,650
			$     -340,750
Retained Earning, December 31 2017			$    2,873,260