Question
In: Accounting
Presented below are 11 income statement items from Braun Company for the year ended December 31,...
Presented below are 11 income statement items from Braun Company for the year ended December 31, 2020.
Sales revenue $2,700,000
Cost of goods sold 1,150,000
Interest revenue 15,000
Loss from abandonment of plant assets 45,000
Gain from extinguishment of debt 28,000
Selling expenses 290,000
Administrative expenses 190,000
Effect of change in estimated useful lives of fixed assets (included in administrative expenses) 35,000
Loss from earthquake 30,000
Gain on disposal of discontinued operation 50,000
Instructions
b. Compute comprehensive income for Braun in 2020, assuming Braun had an unrealized holding loss on an available-for-sale debt investment, net of tax, $12,000.
Solutions
Expert Solution
b
Comprehensive income for braun in 2020 = (Net income -
Unrealized holding loss on an available-for-sale debt investment,
net of tax)
=> ($761600 - $12000)
=> $749600 (Ans)
Working Notes:
Computation of Net income
| Particulars` | Amount ($) |
| Sales revenue | 2700000 |
| Less: Cost of goods sold | (1150000) |
| Gross profit | 1550000 |
| Less: Selling expenses | (290000) |
| Less: Administrative expenses | (190000) |
| Income from operations | 1070000 |
| Add: interest revenue | 15000 |
| Add: Gain from extinguishment of debt | 28000 |
| Less: loss from abandonment of plant assets | (45000) |
| Income before income taxes | 1068000 |
| Less: Income tax (since no information on income tax is given , we are assuming it to be 30%) |
(320400) |
| Income from continuing operations | 747600 |
| Add: Gain from sale of discontinued operation | 50000 |
| Less: Applicable income tax (30%) | (15000) |
| Income before extraordinary items | 782600 |
| Less: Loss from earthquake | (30000) |
| Add: Applicable income tax (30%) | 9000 |
| Net income | 761600 |
(Income tax has been assumed to be 30% for computation purpose but the valuation is correct. If income tax rate is different, let me know in comments and i'll make the necessary adjustments)
(If there are any questions, kindly let me know in comments. If the soluition is to your satisfaction, a thumbs up would be appreciated. Thank You)
ekkarill92 answered 2 years agoRelated Solutions
Presented below are 11 income statement items from Braun Company for the year ended December 31,...
Presented below are 11 income statement items from Braun Company
for the year ended December 31, 2020.
Sales revenue $2,700,000
Cost of goods sold 1,150,000
Interest revenue 15,000
Loss from abandonment of plant assets 45,000
Gain from extinguishment of debt 28,000
Selling expenses 290,000
Administrative expenses 190,000
Effect of change in estimated useful lives of fixed assets
(included in administrative expenses) 35,000
Loss from earthquake 30,000
Gain on disposal of discontinued operation 50,000
Instructions
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Presented below is an income statement for Kinder Company for the year ended December 31, 2015....
Presented below is an income statement for Kinder Company for
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Income Statement
For the Year Ended December 31, 2015
Net
sales
$850,000
Costs and expenses:
Cost of goods
sold
640,000
Selling, general, and
administrative
expenses
70,000
Other,
net
20,000 730,000
Income before income
taxes
120,000
Income
taxes
36,000
Net
income
$ 84,000
Additional information:
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Presented below is income statement information of the Nebraska
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Sales Revenue
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Cost of goods sold
445,000
Salaries expense
108,000
Insurance expense
38,000
Dividend revenue
4,800
Depreciation expense
36,000
Miscellaneous
30,000
Income tax expense
53,000
Loss on sale of investments
9,800
Rent expense
28,000
Required:
Prepare the necessary closing entries at December 31, 2018. (If
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Presented below is income statement information of the Schefter
Corporation for the year ended December 31, 2018. Sales revenue $
512,000 Salaries expense 82,800 Interest revenue 6,800 Advertising
expense 11,500 Gain on sale of investments 9,200 Cost of goods sold
281,600 Insurance expense 14,300 Interest expense 3,900 Income tax
expense 41,000 Depreciation expense 24,000 Required: Prepare the
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Rembrandt Paint Company had the following income statement items for the year ended December 31, 2018...
Rembrandt Paint Company had the following income statement items
for the year ended December 31, 2018 ($ in 000s): Net sales $
31,000 Cost of goods sold $ 17,000 Interest income 330 Selling and
administrative expenses 3,800 Interest expense 610 Restructuring
costs 2,100 In addition, during the year the company completed the
disposal of its plastics business and incurred a loss from
operations of $2.9 million and a gain on disposal of the
component’s assets of $4.6 million. 600,000 shares...
Rembrandt Paint Company had the following income statement items for the year ended December 31, 2018...
Rembrandt Paint Company had the following income statement items
for the year ended December 31, 2018 ($ in 000s):
Net sales
$
33,000
Cost of goods sold
$
18,000
Interest income
350
Selling and administrative
expenses
4,000
Interest expense
650
Restructuring costs
2,300
In addition, during the year the company completed the disposal of
its plastics business and incurred a loss from operations of $3.1
million and a gain on disposal of the component’s assets of $5.0
million. 600,000...
Rembrandt Paint Company had the following income statement items for the year ended December 31, 2016...
Rembrandt Paint Company had the following income statement items
for the year ended December 31, 2016 ($ in 000s):
Net sales
$
34,000
Cost of goods
sold
$
18,500
Interest income
360
Selling and
administrative expenses
4,100
Interest
expense
670
Restructuring
costs
2,400
In addition, during the year
the company completed the disposal of its plastics business and
incurred a loss from operations of $3.2 million and a gain on
disposal of the component’s assets of $5.2 million. 600,000 shares...
Rembrandt Paint Company had the following income statement items for the year ended December 31, 2018...
Rembrandt Paint Company had the following income statement items
for the year ended December 31, 2018 ($ in 000s): Net sales $
27,000 Cost of goods sold $ 15,000 Interest income 290 Selling and
administrative expenses 3,400 Interest expense 530 Restructuring
costs 1,700 In addition, during the year the company completed the
disposal of its plastics business and incurred a loss from
operations of $2.5 million and a gain on disposal of the
component’s assets of $3.8 million. 600,000 shares...
Rembrandt Paint Company had the following income statement items for the year ended December 31, 2018...
Rembrandt Paint Company had the following income statement items
for the year ended December 31, 2018 ($ in 000s):
Net sales
$
27,000
Cost of goods sold
$
15,000
Interest income
290
Selling and administrative
expenses
3,400
Interest expense
530
Restructuring costs
1,700
In addition, during the year the company completed the disposal of
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Rembrandt Paint Company had the following income statement items for the year ended December 31, 2016...
Rembrandt Paint
Company had the following income statement items for the year ended
December 31, 2016 ($ in 000s):
Net
sales
$
20,000
Cost
of goods sold
$
11,500
Interest income
220
Selling and administrative expenses
2,700
Interest expense
390
Restructuring costs
1,000
In addition, during the year
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incurred a loss from operations of $1.8 million and a gain on
disposal of the component’s assets of $2.4 million. 600,000 shares...
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