Use the following to answer questions The company reported the following income statement results: Sales $
Question:
Use the following to answer questions
The company reported the following income statement results:
Sales $
Sales returns & allowances
Gross profit
Operating expense
Gain on sale of equipment
Net income
$Calculate Net sales
$ Calculate Cost of Goods Sold
$ Calculate operating income
$Calculate Income before Income tax IBT
$ Calculate income tax expense
Calculate the gross profit margin one decimal place
Calculate the profit margin one decimal place
$Assume the company had a $ LOSS instead of the $ gain on the sale of
equipment, determine IBT.
Use the following to answer questions
Last year the company had the following expenditures related to developing its trademark:
General advertising costs $
Advertising specifically focused on trademark
Legal fees to register trademark
Legal fees for successful defense of new trademark
Total $
During your yearend review of the accounts related to intangibles, you discover that the company has capitalized
all the above as costs of the trademark. Management contends that all the costs increase the value of the trademark
and, therefore, should be capitalized.
Which of the above costs should NOT be capitalized?
$ What is the total cost that should be capitalized to the trademark account?
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill