Intermediate Accounting
9th Edition
ISBN: 9781259722660
Author: J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 4, Problem 4.4BE
Multiple -step income statement
• LO4–1, LO4–3
The following is a partial year-end adjusted
| Account Title | Debits | Credits |
| Sales revenue | 300,000 | |
| Loss on sale of investments | 22,000 | |
| Interest revenue | 4,000 | |
| Cost of goods sold | 160,000 | |
| General and administrative expenses | 40,000 | |
| Restructuring costs | 50,000 | |
| Selling expenses | 25,000 | |
| Income tax expense | 0 |
Income tax expense has not yet been recorded. The income tax rate is 40%. Determine the following: (a) operating income (loss), (b) income (loss) before income taxes, and (c) net income (loss).
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Mirror Mart uses the balance sheet aging method to account for uncollectible debt on receivables. The following is the past-due category information for outstanding receivable debt for 2019.
0-30 days 31-90 days Over 90 days
past due
past due
past due
Accounts receivable amount
$55,000
$33,000
$17,000
Percent uncollectible
8%
15%
30%
Total per category
?
Total uncollectible
?
To manage earnings more efficiently, Mirror Mart decided to change past-due categories as follows.
0-60 days 61-120 days Over 120 days
past due
past due
past due
Accounts receivable Amount
$84,000
$11,000
$7,000
Percent uncollectible
8%
15%
30%
Total per category
?
?
?
Total uncollectible
?
Complete the following.
A. Complete each table by filling in the blanks.
0-30 days
31-90 days
Over 90 days
past due
past due
past due
Accounts receivable amount
$55,000
$33,000
$17,000
Percent uncollectible
8%
15%
30%
Total per category
Total uncollectible
Question 4: Us the information below to answer the following questions
AR, Net of allowance for uncollectable accounts of 16 and 17
Partial Income statement
Revenue
COGS
Gross Profit
SG&A Expense
Bad Debt Expense
Pre Tax Income
Other information
Write offs were $9 and $14 in years 1 and 2, respectively
There was a recovery of $2 in year 2
Year 1
140
Year 1
1,120
680
440
(350)
(12)
78
Year 2
168
Year 2
1,480
720
760
(375)
(13)
372
Question 4, Part 1: What entries did the firm make to the allowance for uncollectable accounts
in year 1?
Net Income
Interest
(Loss)
$ 185, 000
179, 600
157, 250
188, 100
Expense
$ 59,200
80, 820
Income Taxes
a.
$ 46, 250
b.
64, 656
66,045
90, 288
C.
44, 030
11, 286
d.
Compute times interest earned. Which company indicates the strongest ability to pay interest expense as it comes due?
Complete this question by entering your answers In the tabs below.
Times Interest
Interest
Earned Ratio
Coverage
Compute times interest earned.
Times Interest Earned Ratio
Company
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Choose Denominator:
Ratio
%3D
%3D
times
times
times
!!
times
!!
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Chapter 4 Solutions
Intermediate Accounting
Ch. 4 - The income statement is a change statement....Ch. 4 - What transactions are included in income from...Ch. 4 - Prob. 4.3QCh. 4 - Prob. 4.4QCh. 4 - Prob. 4.5QCh. 4 - What are restructuring costs and where are they...Ch. 4 - Define intraperiod tax allocation. Why is the...Ch. 4 - How are discontinued operations reported in the...Ch. 4 - What is meant by a change in accounting principle?...Ch. 4 - Prob. 4.10Q
Ch. 4 - The correction of a material error discovered in a...Ch. 4 - Define earnings per share (EPS). For which income...Ch. 4 - Prob. 4.13QCh. 4 - Describe the purpose of the statement of cash...Ch. 4 - Prob. 4.15QCh. 4 - Explain what is meant by noncash investing and...Ch. 4 - Distinguish between the direct method and the...Ch. 4 - Prob. 4.18QCh. 4 - Prob. 4.19QCh. 4 - Show the calculation of the following...Ch. 4 - Show the DuPont frameworks calculation of the...Ch. 4 - Prob. 4.22QCh. 4 - Prob. 4.23QCh. 4 - Prob. 4.1BECh. 4 - Multiple -step income statement LO41, LO43 Refer...Ch. 4 - Prob. 4.3BECh. 4 - Multiple -step income statement LO41, LO43 The...Ch. 4 - Prob. 4.5BECh. 4 - Prob. 4.6BECh. 4 - Prob. 4.7BECh. 4 - Discontinued operations LO44 Refer to the...Ch. 4 - Discontinued operations LO44 Refer to the...Ch. 4 - Prob. 4.10BECh. 4 - Prob. 4.11BECh. 4 - Prob. 4.12BECh. 4 - Statement of cash flows; indirect method LO48 Net...Ch. 4 - Prob. 4.14BECh. 4 - Prob. 4.15BECh. 4 - Profitability ratios LO410 The 2018 income...Ch. 4 - Prob. 4.17BECh. 4 - Inventory turnover ratio LO410 During 2018, Rogue...Ch. 4 - Operating versus Nonoperating Income LO41 Pandora...Ch. 4 - Income statement format; single step and multiple...Ch. 4 - Income statement format; single step and multiple...Ch. 4 - Multiple-step continuous statement of...Ch. 4 - Income statement presentation LO41, LO45 The...Ch. 4 - Prob. 4.6ECh. 4 - Income statement presentation; discontinued...Ch. 4 - Discontinued operations; disposal in subsequent...Ch. 4 - Discontinued operations; disposal in subsequent...Ch. 4 - Earnings per share LO45 The Esposito Import...Ch. 4 - Comprehensive income LO46 The Massoud Consulting...Ch. 4 - Prob. 4.12ECh. 4 - Prob. 4.13ECh. 4 - IFRS; statement of cash flows LO48, LO49 Refer to...Ch. 4 - Prob. 4.15ECh. 4 - Prob. 4.16ECh. 4 - Statement of cash flows; indirect method LO48...Ch. 4 - Prob. 4.18ECh. 4 - Prob. 4.19ECh. 4 - Statement of cash flows; indirect method LO48...Ch. 4 - Statement of cash flows; direct method LO48 Refer...Ch. 4 - Prob. 4.22ECh. 4 - Prob. 4.23ECh. 4 - Concepts; terminology LO41, LO42, LO43, LO44,...Ch. 4 - Inventory turnover; calculation and evaluation ...Ch. 4 - Evaluating efficiency of asset management LO410...Ch. 4 - Profitability ratios LO410 The following...Ch. 4 - Prob. 4.28ECh. 4 - Prob. 4.29ECh. 4 - Prob. 4.30ECh. 4 - Prob. 4.31ECh. 4 - Prob. 4.32ECh. 4 - Comparative income statements; multiple-step...Ch. 4 - Discontinued operations LO44 The following...Ch. 4 - Income statement presentation; Discontinued...Ch. 4 - Restructuring costs; Discontinued operations;...Ch. 4 - Income statement presentation; Restructuring...Ch. 4 - Income statement presentation; Discontinued...Ch. 4 - Income statement presentation; statement of...Ch. 4 - Multiple-step statement of income and...Ch. 4 - Statement of cash flows LO48 The Diversified...Ch. 4 - Integration of financial statements; Chapters 3...Ch. 4 - Statement of cash flows; indirect method LO48...Ch. 4 - Calculating activity and profitability ratios ...Ch. 4 - Use of ratios to compare two companies in the same...Ch. 4 - Creating a balance sheet from ratios; Chapters 3...Ch. 4 - Prob. 4.15PCh. 4 - Interim financial reporting Appendix 4 Branson...Ch. 4 - Prob. 4.1BYPCh. 4 - Judgment Case 42 Restructuring costs LO43 The...Ch. 4 - Prob. 4.3BYPCh. 4 - Prob. 4.4BYPCh. 4 - Prob. 4.5BYPCh. 4 - Prob. 4.6BYPCh. 4 - Prob. 4.7BYPCh. 4 - IFRS Case 48 Statement of cash flows;...Ch. 4 - Judgment Case 49 Income statement presentation;...Ch. 4 - Prob. 4.10BYPCh. 4 - Integrating Case 412 Balance sheet and income...Ch. 4 - Prob. 4.13BYPCh. 4 - Prob. 4.17BYPCh. 4 - Prob. 4.18BYPCh. 4 - Continuing Cases Target Case LO43, LO44, LO46,...
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