In the current year, Randa Merchandising Incorporated sold its interest in a chain of wholesale outlets, taking the companycompletely out of the wholesaling business. The company still operates its retail outlets. A listing of the major sections ofan income statement follows.1. Net sales2. Gain on state's condemnation of company property3. Cost of goods sold4. Income tax expense5. Depreciation expense6. Gain on sale of wholesale business segment, net of tax7. Loss from operating wholesale business segment, net of tax8. Loss of assets from meteor strikeExercise 17-18A (Algo) Income statement presentation LO A2Net salesExpenses:ItemTotal operating expensesOther unusual and/or infrequent gains (losses)Discontinued segment:RANDA MERCHANDISING, INCORPORATEDIncome StatementFor Year Ended December 31Prepare the December 31 year-end income statement. (Loss amounts should be indicated with a minus sign.)Debit$$ 1,684,000247,000264,000505,000728,0000000Credit$ 3,300,000262,00000882,000

Answer :Prepare the December 31 year end Income statement :

Answered: ss segment, net of tax siness segment,…

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Accounting

ss segment, net of tax siness segment, net of ta

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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Question

In the current year, Randa Merchandising Incorporated sold its interest in a chain of wholesale outlets, taking the company
completely out of the wholesaling business. The company still operates its retail outlets. A listing of the major sections of
an income statement follows.
1. Net sales
2. Gain on state's condemnation of company property
3. Cost of goods sold
4. Income tax expense
5. Depreciation expense
6. Gain on sale of wholesale business segment, net of tax
7. Loss from operating wholesale business segment, net of tax
8. Loss of assets from meteor strike
Exercise 17-18A (Algo) Income statement presentation LO A2
Net sales
Expenses:
Item
Total operating expenses
Other unusual and/or infrequent gains (losses)
Discontinued segment:
RANDA MERCHANDISING, INCORPORATED
Income Statement
For Year Ended December 31
Prepare the December 31 year-end income statement. (Loss amounts should be indicated with a minus sign.)
Debit
$
$ 1,684,000
247,000
264,000
505,000
728,000
0
0
0
0
Credit
$ 3,300,000
262,000
0
0
882,000

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PROBLEM 3: EXERCISES 1. Park Co. has the following information for the current year: Pretax income 900,000 Penalty on late filing of income tax return Interest on borrowings incurred to acquire tax- 30,000 exempt securities Interest income on government securities Excess of tax depreciation over book depreciation Excess of revenue recognized over taxable income Excess of provision over actual expenditures Advanced rent received (taxable upon receipt) Unrealized loss on change in fair value of investment Temporary differences as at the beginning of the year 3,000 9,000 60,000 45,000 54,000 12,000 18,000 Income tax rate 30%