8. The following information is related to Diego Company for the year 2025. Cost of goods sold $260,000 Operating expenses Other revenues and gains Unrealized gain on available-for-sale securities Gain on disposal of plastics division related to discontinued operations 5,600 15,000 Net sales Other expenses and losses Loss on plastics division operations related to discontinued operations 130,000 440,000 9,600 $ 60,000 50,000 Prepare a multiple-step income statement and a comprehensive income statement for Diego Company (the two statement approach). The income tax rate is 30%, and the weighted-average number of common shares outstanding is 10,000.

8. The following information is related to Diego Company for the year 2025. Cost of goods sold $260,000 Operating expenses Other revenues and gains Unrealized gain on available-for-sale securities Gain on disposal of plastics division related to discontinued operations 5,600 15,000 Net sales Other expenses and losses Loss on plastics division operations related to discontinued operations 130,000 440,000 9,600 $ 60,000 50,000 Prepare a multiple-step income statement and a comprehensive income statement for Diego Company (the two statement approach). The income tax rate is 30%, and the weighted-average number of common shares outstanding is 10,000.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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16. Quick assets P208,000 Acid test ratio 2.6 to 1 Current ratio 3.5 to 1 Net sales for the year P1,800,000 Cost of sales for the year P990,000 Average total assets P1,200,000 The company’s inventory balances at December 31 is? The company’s asset turnover ratio for the year is?
KM Manufacturing Company The income statement for the year ended December 31, 2020, for KM Manufacturing Company contains the following condensed information. KM Manufacturing Company Income Statement For the Year Ended December 31, 2X20 Sales revenue Cost of goods sold Operating expenses (excluding depreciation) Depreciation expense Loss on disposal of plant assets Income before income taxes P6,583,000 P2,810,000 2,086,000 880,000 24,000 5,800,000 783,000 353,000 P430,000 Income tax expense Net income The P24,000 loss resulted from selling equipment for P270,000 cash. The equipment was purchased at a cost of P750,000. The following balances are reported on KM's comparative balance sheets at December 31. KM Manufacturing Company Comparative Balance Sheets 2X20 2X19 Cash Accounts receivable Inventory Accounts payable P672,000 775,000 834,000 521,000 P130,000 610,000 867,000 501,000 Income tax expense of P353,000 represents the amount paid in 2020. Dividends declared and paid in 2020…
KM Manufacturing Company The income statement for the year ended December 31, 2020, for KM Manufacturing Company contains the following condensed information. KM Manufacturing Company Income Statement For the Year Ended December 31, 2X20 Sales revenue Cost of goods sold Operating expenses (excluding depreciation) Depreciation expense Loss on disposal of plant assets Income before income taxes P6,583,000 P2,810,000 2,086,000 880,000 5,800,000 783,000 353,000 P430,000 24,000 Income tax expense Net income The P24,000 loss resulted from selling equipment for P270,000 cash. The equipment was purchased at a cost of P750,000. The following balances are reported on KM's comparative balance sheets at December 31. KM Manufacturing Company Comparative Balance Sheets Cash Accounts receivable Inventory | Accounts payable 2X20 P672,000 775,000 834,000 521,000 2X19 P130,000 610,000 867,000 501,000 Income tax expense of P353,000 represents the amount paid in 2020. Dividends declared and paid in 2020…
Dela Rosa Company Company The income statement for the year ended December 31, 2020, for Dela Rosa Company Company contains the following condensed information. Dela Rosa Company Company Income Statement For the Year Ended December 31, 2X20 Sales revenue P6,583,000 Cost of goods sold P2,810,000 Operating expenses (excluding depreciation) 2,086,000 Depreciation expense 880,000 Loss on disposal of plant assets 24,000 5,800,000 Income before income taxes 783,000 Income tax expense 353,000 Net income P430,000 The P24,000 loss resulted from selling equipment for P270,000 cash. The equipment was purchased at a cost of P750,000. The following balances are reported on Delar Rosa’s comparative balance sheets at December 31. Dela Rosa Company Company Comparative Balance Sheets 2X20 2X19 Cash P672,000 P130,000 Accounts receivable 775,000 610,000…
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Income Statement Format The following information from Buchanan Company’s current operations is available: Administrative expenses $73,000 Cost of goods sold 470,000 Sales revenue 772,000 Selling expenses 87,000 Interest expense 10,000 Loss from operations of discontinued segment 60,000 Gain on disposal of discontinued segment 40,000 Income taxes: Amount applicable to ordinary operations 40,000 Reduction applicable to loss from operations of discontinued segment 14,000 Amount applicable to gain on disposal of discontinued segment 8,000 Requireda. Prepare a multiple-step income statement. (Disregard earnings per share.)b. Prepare a single-step income statement. (Disregard earnings per share.)Note: Do not enter any answers as negative numbers unless it's indicated with an asterisk *. BUCHANAN COMPANYMultiple-Step Income StatementFor Year Ended Sales Revenue Answer Answer Answer Answer Answer Selling Expenses Answer…
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K George Company had the following data for the current year. What is the income from continuing operations for the year? Net Sales $169,000 16,000 Discontinued Operations Gain (after tax) Cost of Goods Sold Income Tax rate 82,000 40% 14,000 Operating Expenses Other Income and (Expenses): Gain on Sale of Equipment Loss on Disposal of Equipment A. $73,000 OB. $45,000 OC. $60,000 OD. $75,000 8,000 (6,000) 27.
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