problem 2

Project Description:

credit sales $ 1,325,000
purchase discounts $ 18,000
purchases $ 820,000
earthquake loss $ 60,000
selling expenses $ 128,000
cash $ 60,000
accounts receivable $ 90,000
common stock $ 200,000
accumulated depreciation $ 180,000
dividend revenue $ 8,000
inventory, january 1, 2011 $ 160,000
inventory, december 31, 2011 $ 125,000
unearned service revenue $ 4,400
accrued interest payable $ 1,000
land $ 370,000
patents $ 100,000
retained earnings, january 1, 2011 $ 270,000
interest expense $ 17,000
cumulative effect of change: straight line to ddb deprecation method $ 40,000
general & administrative expenses $ 210,000
allowances for doubtful accounts $ 5,000
notes payable (maturity 7/1/2014) $ 200,000
machinery and equipment $ 450,000
materials and supplies $ 40,000
accounts payable $ 60,000

further investigation showed additional information is as followed:

1. olson corp. capital structure consists of $ 40,000 shares of common stock
2. income taxes applicable to income before continuing operations is $67,200 (hint: you need to find out and calculate the tax rate and determine the taxes below the line items)
3. beginning inventory, at january 1, 2011, was overstated by $8,500
4. dividends declared in december 2011 were $29,000
5. cash sales for $75,000 were not recorded by the bookkeepers

required: after making necessary adjustment and correction, prepare the following

1. multi step income statement for 2011 including below the line also include earning per common share analysis.
2. retained earnings statement for 2011
Skills Required:
Project Stats:

Price Type: Negotiable

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