Question

Duke Company’s records show the following account balances at December 31, 2016:

Sales	$	18,000,000
Cost of goods sold		10,500,000
General and administrative expenses		1,150,000
Selling expenses		650,000
Interest expense		850,000

Income tax expense has not yet been determined. The following events also occurred during 2016. All transactions are material in amount.

1.	$450,000 in restructuring costs were incurred in connection with plant closings.
2.	Inventory costing $550,000 was written off as obsolete. Material losses of this type are considered to be unusual.
3.	It was discovered that depreciation expense for 2015 was understated by $65,000 due to a mathematical error.
4.	The company experienced a foreign currency translation adjustment loss of $350,000 and had unrealized gains on investments of $330,000.

Required:

Prepare a single, continuous multiple-step statement of comprehensive income for 2016. The company’s effective tax rate on all items affecting comprehensive income is 40%. Each component of other comprehensive income should be displayed net of tax. Ignore EPS disclosures. (Amounts to be deducted should be indicated with a minus sign.)

Answer 1