problem 1 information about space travel corporation which sells rocket engines is s 4352207



1.Information about Space Travel Corporation, which sells rocket engines, is shown below:

Common shares outstanding150,000

Advertising expense$  9,000

Cost of goods sold330,000

Depreciation expense13,500

Income tax expense15,000

Income tax payable7,500

Interest expense6,000

Payments to owners4,500

Retained earnings37,500

Salaries expense45,000

Sales revenue450,000


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

2.Sandovar Company reported the following income statement for June 2007:

Sandovar Company

Income Statement

For the Month Ended June 30, 2007


Cost of sales552,000


Selling expense88,000

General and administrative expense54,000

Other income and expense, net(22,000)


Income before income taxes64,000

Provision for income tax20,000

$ 44,000



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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