Question

In: Accounting

ABC Inc. Statement of Income For the period October 1, 2018 to September 30, 2019 Revenue                           &nb

ABC Inc.

Statement of Income

For the period October 1, 2018 to September 30, 2019

Revenue                                                                                                                       $15,800,000

Operating Expenses:

Rent                                                                                                      1,350,000

Advertising expense                                                                       1,105,000

Bad Debts                                                                                             179,000

Salaries and wages                                                                         3,800,000           

Interest                                                                                                3,150,000

Accounting and legal                                                                         195,000

Meals and entertainment                                                            1,300,000

Amortization                                                                                         750,000

Repairs and maintenance                                                                500,000

Automotive                                                                                        2,120,000        

                                                                                                                                               

Net Income from Operations                                                                             1,351,000                                                   

Gain on disposal of asset                                                                                         350,000

Net income before taxes                                                                                      1,701,000  

Income Taxes                                                                                                               635,000

Net Income                                                                                                            $1,066,000

Additional Information relating to the preparation of the statement of income for the period:

  1. Legal fees of $120,000 were accrued at September 30, 2019 to reflect an estimate of potential legal fees for a threatened lawsuit against the company.
  2. The company paid XYZ Advertising Inc. a total of $600,000 for advertising services for the period. It was decided that $243,000 be expensed in the current period and the remaining amount be capitalized as the company will benefit from this outlay in the following year.
  3. Included in salaries and wages is a bonus accrual to the shareholder in the amount of $1,250,000. This amount was paid to the shareholder with appropriate source deductions (Income tax, CPP) on March 30, 2020.
  4. Included in interest expense is $23,500 of interest paid to CCRA for late tax installments.
  5. Included in repairs and maintenance is an accrual of $185,000 that represents potential warranty work for defective items sold.
  6. Automotive expenses consists of company owned and or leased vehicles provided to employees of the company to perform their employment duties.
  7. During the period the company sold its land and building and moved into rental space. The company received $1,900,000 for the sale of the land and building. The land and building had an original cost of $350,000 and $950,000, respectively. The undepreciated capital cost (UCC) of the building at October 1, 2018 was $949,000.
  8. For the period, the company is eligible to claim CCA of $340,000 on assets in various classes.

Solutions

Expert Solution

INCOME STATMENT OF ABC INC FOR THE PEROID ENDED ON SEPTEMBER 2019.

PARTICULARS AMT IN $'000 AMT IN $'000
INCOME
- revenue from operation 15800
-other income :-
(1) gain on disposal of assests 1701 17501
total income (A)
EXPENSES
-rent 1350
-advertiseing 1105
(less :- c/f for next years 357 748
bad depts 179
salary & wages 3800
less :- bonus of share holder incuded 1250 2550
intrest 3150
less:- ccra tax istallments 23 3127
accounting & legal 195
add:- legal fees 120 315
meals & entertainment 1300
amortization 750
repair & maintances 500
less:- warranty work expense 185 315
automotive 2120
deprication of building @ 10% 94
add:- cca assests claim 340 434
TOTAL EXPENSES(B) 13188
PROFIT BEFORE TAX (A-B) 4313
less :- Income tax 635
NET PROFIT 3678

so as per above we will perpare income statment of ABC co pvt ltd.


Related Solutions

Consolidated Statement of Financial Position For the year ended 30 September 2019 2019 2019 2018 2018...
Consolidated Statement of Financial Position For the year ended 30 September 2019 2019 2019 2018 2018 ASSETS Note ZMW’000s USD’000s ZMW’000s USD’000s Non-current assets Goodwill 13 166,801 12,636 166,801 13,628 Property, plant and equipment 14 2,841,824 215,290 2,902,221 237,110 Investment in associate 15(e) 12,376 938 15,412 1,259 Deferred tax asset 10(e) 56,525 4,282 47,854 3,910 3,077,526 233,146 3,132,288 255,907 Current assets Biological assets 16 170,417 12,910 181,674 14,843 Inventories 17 941,159 71,300 639,811 52,272 Trade and other receivables 18 98,025...
Below are the statements of financial position of three entities as at 30 September 2019                            &nb
Below are the statements of financial position of three entities as at 30 September 2019                                                             Papa               Mama              Daughter $’000               $’000               $’000 Non-current assets                                       24,000             7,500               3,000 Property, plant and equipment                       14,000             7,500               3,000 Investments                                                    10,000             –                      – Current assets                                              6,000               3,000               1,500 ––––––            ––––––            –––––– 30,000             10,500             4,500 ––––––            ––––––            –––––– Equity & liabilities Equity                                                             17,500             6,500              ...
(RM MILLION) FOR THE YEAR ENDED 31 DECEMBER 2019 2018 2019 INCOME STATEMENT 1.Revenue 10,638 11,860...
(RM MILLION) FOR THE YEAR ENDED 31 DECEMBER 2019 2018 2019 INCOME STATEMENT 1.Revenue 10,638 11,860 2.Net total expenses 9,419 11,136 3.Operating profit 1,219 725 4.Profit before taxation 1,335 -522 5.Taxation 360 238 6.Net profit 1,695 -283 BALANCE SHEET 7.Deposits, cash and bank balances 3,327 2,588 8.Total assets 18,550 25,595 9.Net debt (Total debt - Total Cash) 287 -2,159 10.Shareholders' equity 6,185 2,911 CASH FLOW STATEMENTS 11.Cash flow from operating activities 353 2,081 12.Cash flow from investing activities 9,049 4,660...
Music Magic Income Statement For the Year Ended December 31st,2019 2019 2018 Revenues Service Revenue...
Music Magic Income Statement For the Year Ended December 31st, 2019 2019 2018 Revenues Service Revenue $6,500 $6,000 Expenses Advertising Expense $800 $750 Depreciation Expense 400 350 Interest Expense 100 100 Rent Expense 500 500 Salaries Expense 2,400 2,200 Supplies Expense 900 800 Total Expenses $5,100 $4,700 Net Income $1,400 $1,300You will need to complete a horizontal analysis on the income statement and a vertical analysis on the Balance sheet. The information for the assignment can be found in the...
In 2018, NB Inc.'s federal taxable income was $280,000. Compute the required installment payments of 2019...
In 2018, NB Inc.'s federal taxable income was $280,000. Compute the required installment payments of 2019 tax in each of the following cases: (Round your Intermedlate calculations and final answers to the nearest whole dollar amount.) a. NB's 2019 taxable income is $429,000. b. NB's 2019 taxable income is $902,000. c. NB's 2019 taxable income is $1,162,000. a. Total installment payments b. Total installment payments C. Total installment payments
1. Bien Company has the following financial statements for 2018:              Income statement                 &nb
1. Bien Company has the following financial statements for 2018:              Income statement                                               balance sheet                                  Sales                 $ 36,000               Assets       $ 28,300      Debt          $   7000        Costs                   27,500                                                     Equity        21,300        Net income       $   8,500               Total          $ 28,300      Total             $28,300 The company has no dividend currently. It expects 10% sales, costs and income increase in 2019. It also predicts assets increase by 10% as well.    Create a pro forma 2019 income statement and balance...
Income Statement For the Year Ended December 31, 2018 Sales                                &nb
Income Statement For the Year Ended December 31, 2018 Sales                                                               $8,500,000 Manufacturing Expenses Variable                                $3,250,000 Fixed overhead                       640,000       3,890,000 Gross Margin                                                  $4,610,000 Selling and administrative expenses Commissions                           $580,000 Fixed marketing expenses       300,000 Fixed admin expenses               450,000      1,330,000 Net Operating Income                                     $3,280,000 Fixed Interest expenses                                       230,000     Income before Taxes                                      $3,050,000      Income Taxes (21%)                                            640,500 Net Income                                                     $2,409,500 Your company is considering out-sourcing the sales and marketing to an agency specializing in these types of sales....
Income Statement For the Year Ended December 31, 2018 Sales                                &nb
Income Statement For the Year Ended December 31, 2018 Sales                                                               $8,500,000 Manufacturing Expenses Variable                                $3,250,000 Fixed overhead                       640,000       3,890,000 Gross Margin                                                  $4,610,000 Selling and administrative expenses Commissions                           $580,000 Fixed marketing expenses       300,000 Fixed admin expenses               450,000      1,330,000 Net Operating Income                                     $3,280,000 Fixed Interest expenses                                       230,000     Income before Taxes                                      $3,050,000      Income Taxes (21%)                                            640,500 Net Income                                                     $2,409,500 Your company is considering out-sourcing the sales and marketing to an agency specializing in these types of sales....
INCOME STATEMENT (IN MILL$): January 1, 2019 – December 31, 2019 Revenue = 400; Gross Profit...
INCOME STATEMENT (IN MILL$): January 1, 2019 – December 31, 2019 Revenue = 400; Gross Profit Margin = 30%; Operating Expenses (before depreciation) = 20; Depreciation = 20; Interest = 10; Average Tax Rate =40%; Preferred Dividend = 5; Common Dividend= 7; # of shares outstanding=10 million; Per Share Price of Common Stock = $50.00 BALANCE SHEET (IN MILL$): December 31, 2019 Cash = 5; A/R = 20; Inventory = 55; Net Fixed Asset = 120; Accounts Payable= 10; Accrued...
Current Income Statement                                      &nb
Current Income Statement                                                        Current Balance Sheet Net sales                                   $6,500             Cash                 $   900         Accounts payable $1,020   Less: Cost of goods sold              4,922             Accounts rec.           620         Long-term debt       4,360   Less: Depreciation                         570             Inventory            2,850         Common stock         2,400    Earnings before interest and taxes 1,008             Total                $4,370         Retained earnings 1,190    Less: Interest paid                          300             Net fixed assets   4,600         Taxable Income                        $   708             Total assets       $8,970         Total liab. & equity            $8,970 Less: Taxes                                    248                                                                       ...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT