3 information about iron horses which sells motorcycles is shown below common shares 4352218

3.Information about Iron Horses, which sells motorcycles, is shown below:

Common shares outstanding20,000

Advertising expense24,000

Cost of goods sold660,000

Depreciation expense28,000

Income tax expense20,000

Income tax payable14,000

Interest expense10,000

Payments to owners30,000

Retained earnings70,000

Salaries expense120,000

Sales revenue900,000

Required:

Compute (a) gross profit, (b) income from operations, (c) net income and (d) earnings per share for the period.

4.Environmental Company reported the following income statement for November 2007:

Environmental Company

Income Statement

For the Month Ended November 30, 2007

Sales$319,000

Cost of sales238,000

$81,000

Selling expense27,000

General and administrative expense18,500

Other income and expense, net4,500

50,000

Income before income taxes31,000

Provision for income tax10,000

$21,000

$2.10

Required:

Determine (a) gross profit, (b) product cost expensed during year, (c) non-product operating expenses, (d) operating income, (e) net income and (f) earnings per share.

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