Professional Documents
Culture Documents
$ 540,000
(210,000)
Administrative expenses
(100,000)
Selling expenses
(80,000)
Discontinued operations-loss
(40,000)
110,000
33,000
$ 77,000
$150,000*
45,000
105,000
*$110,000 + $40,000
(28,000)
$ 77,000
$10.50
(2.80)
$ 7.70
PROBLEM 4-4
(a)
TWAIN CORPORATION
Income Statement
For the Year Ended June 30, 2014
Sales
Sales revenue .............................................................
$1,578,500
93,450
1,485,050
896,770
588,280
Operating Expenses
Selling expenses
Sales commissions ................................................
97,600
Salaries and wages expense..................................
56,260
Travel expense ........................................................
28,930
Delivery expense ....................................................
21,400
Entertainment expense ..........................................
14,820
Telephone and Internet expense ...........................
9,030
Maintenance and repairs expense .........................
6,200
Depreciation expense .............................................
4,980
248,785
Administrative Expenses
Maintenance and repairs expense.................
9,130
7,320
7,250
3,450
2,820
6,000
35,970
303,525
38,000
18,000
323,525
102,000
$221,525
$2.66*
*Rounded
TWAIN CORPORATION
Retained Earnings Statement
For the Year Ended June 30, 2014
Retained earnings, July 1, 2013, as reported ..............
Correction of depreciation understatement,
net of tax ....................................................................
$337,000
(17,700)
319,300
221,525
540,825
Less:
Dividends declared on preferred stock .............$ 9,000
Dividends declared on common stock .............. 37,000
Retained earnings, June 30, 2014 ................................
46,000
$494,825
(b)
TWAIN CORPORATION
Income Statement
For the Year Ended June 30, 2014
Revenues
Net sales ....................................................................... $1,485,050
Dividend revenue .........................................................
38,000
Total revenues.....................................................
1,523,050
896,770
248,785
35,970
18,000
1,199,525
323,525
102,000
Expenses
TWAIN CORPORATION
Retained Earnings Statement
For the Year Ended June 30, 2014
$337,000
(17,700)
319,300
221,525
540,825
Less:
Dividends declared on preferred stock ..............
$ 9,000
Dividends declared on common stock ...............
37,000
Retained earnings, June 30, 2014 .................................
46,000
$494,825
PROBLEM 4-6
(a)
ACADIAN CORP.
Retained Earnings Statement
For the Year Ended December 31, 2014
Retained earnings, January 1, as reported .......................................
$257,600
Correction of error from prior period (net of tax) .............................
25,400
Adjustment for change in accounting principle
(net of tax) ........................................................................................
(23,200)
Retained earnings, January 1, as adjusted.......................................
259,800
Add: Net income ...............................................................................
52,300*
Less: Cash dividends declared ........................................................
32,000
Retained earnings, December 31 ......................................................
$280,100