Presented below are selected account balances of Sandra Company at the end of its fiscal year on December 31,…

Presented below are selected account balances of Sandra Company at the end of its fiscal year on December 31,…

Question:

 

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Presented below are selected account balances of Sandra Company at the end of its
fiscal year on December 31, 2022:
Rental revenue
Interest expense
Beginning retained earnings
Dividend revenue
Discontinued operations loss
Flood damage loss
Dividends paid
$8,000
9,500
Selling expenses
Sales revenue
6,400
1,000
Cost of goods sold
3,000
Administrative expenses
4,500 Depreciation overstatement
$ 6,000
50,000
375,000
110,000
30,000
2,000
Additional facts are as follows:
i) The discontinued operations loss was after tax.
ii) $2,000 (net of tax) stated above arose from an internal audit discovery of an error
in the computation of depreciation expense in a prior year.
iii) Applicable income tax rate for all items is 21%.
iv) 100,000 shares of common stock were outstanding throughout the year. There
were no other categories of stock issued.
Instruction
From the above figures and additional facts, prepare a multiple-step income statement
and a retained earnings statement for the fiscal/financial year ended on December 31,
2022.
Note: Be sure to display Earnings Per Share (EPS) as the bottom of the income
statement.

Expert Answer:

Answer rating: 100% (QA)

SOLUTION Based on the information provided we can prepare a multiple step income statement and
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