PROBLEM II (VALOR 25 PUNTOS) Presented below is information related to American Horse Company for 2007 Retained earnings balance, Jan. 1, 2007 Sales for the year Cost of goods sold Interest revenue Selling and administrative expenses Write-off of goodwill (not tax deductible) Income taxes for 2007 Gain on the sales of investments (normal recurring) Loss due to flood damage-extraordinary item (net of tax) Loss on the disposition of the wholesale division (net of tax) Loss on operations of the wholesale division (net of tax) Dividends declared on common stock Dividends declared on preferred stock S 980,000 25,000,000 17,000,000 0,000 4,700,000 820,000 905,000 110,000 440,000 250,000 70,000 Prepare a multiple-step income statement and a retained earnings statement. American Horse Company decided to discontinue its entire wholesale operations and to retain its manufacturing operations. On September 15, American Horse sold the wholesale operations to Roger Company. During 2007, there were 300,000 shares of common stock outstanding all year