Question: For its fiscal year ending October 31 2014 Haas Corporation

For its fiscal year ending October 31, 2014, Haas Corporation reports the following partial data shown below.
Income before income taxes ............. $540,000
Income tax expense (30% 3 $420,000) ......... 126,000
Income before extraordinary items ........... 414,000
Extraordinary loss from flood ............. 120,000
Net income ..................... $294,000
The flood loss is considered an extraordinary item. The income tax rate is 30% on all items.

Instructions
(a) Prepare a correct income statement, beginning with income before income taxes.
(b) Explain in memo form why the income statement data are misleading.


View Solution:


Sale on SolutionInn
Sales3
Views542
Comments
  • CreatedJanuary 30, 2014
  • Files Included
Post your question
5000