Presented below are selected amounts from the records of McGraw Corporation as of December 31, 2012.Presented below are selected amounts from the records of McGraw Corporation as of December 31, 2012.
Cash $ 50,000
Administrative expenses 100,000
Selling expenses 80,000
Net sales 540,000
Cost of goods sold 260,000
Cash dividends declared (2012) 20,000
Cash dividends paid (2012) 15,000
Discontinued operations (loss before income taxes) 40,000
Depreciation expense, not recorded in 2011 30,000
Retained earnings, December 31, 2011 90,000
Effective tax rate 30%
Instructions
(a) Compute net income for 2012.
(b) Prepare a partial income statement beginning with income from continuing operations before income tax, and including appropriate earnings per share information. Assume 20,000 shares of common stock were outstanding during 2012.