Question

The accountant of Sheridan Shoe Co. has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2017.

Rent revenue		$30,000
Interest expense		19,000
Market appreciation on land above cost		32,000
Salaries and wages expense (selling)		115,800
Supplies expense (selling)		18,600
Income tax		38,400
Salaries and wages expense (administrative)		136,900
Other administrative expenses		52,700
Cost of goods sold		497,000
Net sales		981,000
Depreciation on plant assets (70% selling, 30% administrative)		66,000
Cash dividends declared		17,000

There were 20,280 shares of common stock outstanding during the year.

Prepare a multiple-step income statement. (Round earnings per share to 2 decimal places, e.g. 1.48.)

Answer 1

Answer: SHERIDAN SHOE CO Income Statement for the year ending December 31, 2017 Sales Sales Revenue 981,000 497,000 484,000 Cost of Goods Sold Gross Profit Operating Expenses Selling Expenses Salaries and Wages Expense Supplies Expense Depreciation on Sales Egipment ($66,000 * 70%) Administrative Expenses Salaries and Wages Expense Depreciation on Office Eqipment ($66,000 * 30%) Other Administrative Expenses Income from Operations Other Revenues and Gains: 115,800 18,600 46,200 180,600 136,900 19,800 52,700 209,400 390,000 94,000 Rental Revenue 30,000 17,000 32,000 Dividend Revenue Market Appreciation 79,000 173,000 Other Expenses and Losses Interest Expense Income before Income Tax 19,000 154,000 38,400 Income Tax Net Income for the year Earnings per Share 5.70