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    Condensed Income Statement, Periodic Inventory Method

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    Asma Hatam
    The document provides the income statement for Spock Corporation for the year ended December 31, 2004. It shows that Spock Corporation had net sales of $4,162,000, cost of goods sold of $2,665,000, and gross profit of $1,497,000. After operating and non-operating expenses and taxes, Spock Corporation reported net income of $240,240.

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    Condensed Income Statement, Periodic Inventory Method

    Uploaded by

    Asma Hatam
    628 views2 pages
    The document provides the income statement for Spock Corporation for the year ended December 31, 2004. It shows that Spock Corporation had net sales of $4,162,000, cost of goods sold of $2,665,000, and gross profit of $1,497,000. After operating and non-operating expenses and taxes, Spock Corporation reported net income of $240,240.

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    The document provides the income statement for Spock Corporation for the year ended December 31, 2004. It shows that Spock Corporation had net sales of $4,162,000, cost of goods sold of $2,665,000, and gross profit of $1,497,000. After operating and non-operating expenses and taxes, Spock Corporation reported net income of $240,240.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    628 views2 pages

    Condensed Income Statement, Periodic Inventory Method

    Uploaded by

    Asma Hatam
    The document provides the income statement for Spock Corporation for the year ended December 31, 2004. It shows that Spock Corporation had net sales of $4,162,000, cost of goods sold of $2,665,000, and gross profit of $1,497,000. After operating and non-operating expenses and taxes, Spock Corporation reported net income of $240,240.

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    E4-10 (Condensed Income Statement—Periodic Inventory Method) Presented below are selected ledger

    accounts of Spock Corporation at December 31, 2004

    Spock’s effective tax rate on all items is 34%. A physical inventory indicates that the ending inventory is
    $686,000. Instructions prepare a condensed 2004 income statement for Spock Corporation.

    Spock Corporation
    Income Statement

    For Year Ended Dec 31, 2004

    Net Sales......................................................................... $4,162,000

    Cost of goods sold.......................................................... (2,665,000)

    Gross profit on sales .................................................... 1,497,000

    Operating Expenses

    Selling Expenses …....................... $ 636,000

    Admin and general Expense........ 491,000 (1,127,000)

    Income from operations................................................... 370,000

    Other Revenues and Expenses

    Interest revenue......................... 240,000

    Dividend revenue...................... (176,000) 64,000

    Income before Income tax ……………………………………………. 434,000

    Income Tax …………. …………………………….. 147,560)

    Income before extra-ordinary item ………………………. 286,440

    Extra ordinary loss ….………………………….. 70,000

    Less: Applicable tax reduction ……………… (23,800) (46,200)

    Net Income ……………………………………………………………… $ 240,240

    Earnings Per share (900,000 ÷ $ 10 par value = 90,000 share)

    Income before extraordinary item (286,440 ÷ 90,000)… $ 3.18

    Extraordinary Item, net of tax …………………………………….. $ .51

    Net Income …………………………………………………………………. $ 2.67

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