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The following information is related to Dickinson Company for 2014.

Retained earnings balance, January 1, 2014

$800,000

Sales Revenue

17,125,000

Cost of goods sold

9,975,000

Interest expense

271,300

Selling expenses

1,767,000

Administrative expenses

2,184,500

Loss on write-off of goodwill (

not

extraordinary)

1,050,000

Interest revenue

421,000

Income taxes for 2014

617,000

Gain on the sale of investments (normal

recurring)

113,400

Loss due to flood damageextraordinary item

(net of tax)

394,800

Loss on the disposition of the wholesale

division (net of tax)

456,200

Loss on operations of the wholesale division

(net of tax)

94,200

Dividends declared on common stock

255,600

Dividends declared on preferred stock

84,800

Dickinson Company decided to discontinue its entire wholesale operations and to

retain its manufacturing operations. On September 15, Dickinson sold the

wholesale operations to Rogers Company. During 2014, there were 200,000 shares

of common stock outstanding all year.

Required:

Prepare a multiple-step income statement in good form.

Do not calculate

earnings per share information

.

3.

(15 points) (Adjusting Entries and Financial Statements) The following are the trial balance and the

other information related to Yorkis Perez, a consulting engineer.

YORKIS PEREZ, CONSULTING ENGINEER

TRIAL BALANCE

DECEMBER 31, 2014

Debit

Credit

Cash

$ 44,500

Accounts Receivable

49,600

Allowance For Doubtful Accounts

$ 750

Inventory

1,960

Prepaid Insurance

1,100

Equipment

25,000

Accumulated DepreciationEquipment

6,250

Unearned Revenue

15,000

Notes Payable

7,200

Owner's Capital

35,010

Service Revenue

100,000

Rent Expense

9,750

Salaries and Wages Expense

30,500

Utilities Expenses

1,080

Office Expense

720

0

$164,210

$164,210

Note: none of the below adjustments/transactions have been recorded. They are NOT reflected in

the above trial balance. You'll need to add some accounts as you record the

adjustments/transactions below:

1. Provided $10,000 of the services related to the unearned revenue reflected in the trial balance.

Record the adjustment.

2. Services performed for clients that were not recorded by December 31, $4,900. Record the

accrued revenue.

3. Bad debt expense for the year is $1,430. Record bad debt expense.

4. Insurance expired during the year $600. Record the adjustment.

5. Equipment has a 10 year useful life and no salvage value. Record depreciation expense.

6. The company took out a loan from the bank (this transaction was already recorded). It was a 90-

day, 10% note for $7,200 taken out on December 1, 2014. Record the accrued interest expense for

the month of December.

7. Rent of the building is $750 per month. The company paid for 5 month's rent on December 1, 2014

(that included December's rent). Record this transaction as of December 31, 2014.

8. Office salaries and wages earned but unpaid December 31, 2014, $2,510. Record accrued salaries

and wages.

9. The owner of the company withdrew $8,000 cash for personal use.

Instructions

(a) From the trial balance and other information given, prepare adjusting/journal entries as of

December 31, 2014 (items 1-9 above).

Accounts

Debits

Credits

1.

2.

3.

4.

5.

6.

7.

8.

9.

(b) Prepare an income statement for 2014, a statement of owner's equity, and a

classified

balance

sheet. The statements should reflect all the adjustments recorded above.

4. (5 points) The following information was taken from the records of Carla Inc. for the year 2017: Income

tax applicable to income from continuing operations $243,338 and income tax applicable to loss on

discontinued operations $28,900.

Gain on sale of equipment

$95,300

Preferred Stock dividends

$22,200

Loss on discontinued operations

85,000

Retained earnings January 1, 2017

651,900

Administrative expenses

240,100

Cost of goods sold

784,300

Rent revenue

43,400

Selling expenses

320,100

Loss on write-down of inventory

67,700

Sales Revenue

1,989,200

Shares outstanding during 2017 were 96,000.

Required:

a. Calculate earnings per share for income from continuing operations

b. Calculate earnings per share for discontinued operations

c. Calculate earnings per share for net income

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