Oak Nursery Corporation’s single-step income statements for 2010 and 2009 follow. 

Oak Nursery Corporation had 20,000 shares of common stock outstanding during both 2010 and 2009. 

Required 

1. From the information provided, prepare multistep income statements for 2009 and 2010 showing percentages of net sales for each component. 

2. Did income from operations increase or decrease from 2009 to 2010? Write a short explanation of why this change occurred. 

3. What effect did other revenues and expenses have on the change in income before income taxes? What action by management probably caused this change?

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Oak Nursery Corporation Income Statements For the Years Ended April 30, 2010 and 2009 2010 2009 Revenues Net sales $525,932 $475,264 1,800 Interest income 850 Total revenues $527,732 $476,114 Costs and expenses Cost of goods sold $234,948 $171,850 Selling expenses 161,692 150,700 42,086 General and administrative expenses 62,866 1,700 $366,336 Interest expense 3,600 Total costs and expenses $463,106 $ 64,626 Income before income taxes $109,778 Income taxes expense 16,000 28,600 $ 81,178 $ 48,626 Net income Earnings per share 2.43 4.06