3.Information about Iron Horses, which sells motorcycles, is shown below:
Common shares outstanding20,000
Advertising expense24,000
Cost of goods sold660,000
Depreciation expense28,000
Income tax expense20,000
Income tax payable14,000
Interest expense10,000
Payments to owners30,000
Retained earnings70,000
Salaries expense120,000
Sales revenue900,000
Required:
Compute (a) gross profit, (b) income from operations, (c) net income and (d) earnings per share for the period.
4.Environmental Company reported the following income statement for November 2007:
Environmental Company
Income Statement
For the Month Ended November 30, 2007
Sales$319,000
Cost of sales238,000
$81,000
Selling expense27,000
General and administrative expense18,500
Other income and expense, net4,500
50,000
Income before income taxes31,000
Provision for income tax10,000
$21,000
$2.10
Required:
Determine (a) gross profit, (b) product cost expensed during year, (c) non-product operating expenses, (d) operating income, (e) net income and (f) earnings per share.