Rembrandt Paint Company had the following income statement items for the year ended December 31,...

Question:

Rembrandt Paint Company had the following income statement items for the year ended December 31, 2013 ($ in 000s):

In addition, during the year the company completed the disposal of its plastics business and incurred a loss from operations of $2.4 million and a gain on disposal of the component?s assets of $3.4 million. 600,000 shares of common stock were outstanding throughout 2013. Income tax expense has not yet been accrued. The income tax rate is 40% on all items of income (loss).

Prepare a multiple-step income statement for 2013, including EPS disclosures.

Income Statement

A financial statement that shows the net income of the company by reducing the total expenses from the total income is identified as an income statement. Single-step and multi-step income statement are the types of the income statement.

Answer and Explanation:

Multi-step income statement as on 31st December 2013

Particulars Amount Amount
Sales revenue
Less: Cost of goods sold
Gross Profit
Operating Expenses:
Selling and administrative
Restructuring costs
Operating Income:
Less: Interest expenses($ 270-$ 490)
Income from continuing operations before income taxes
Less: Income tax expenses
Income From Discontinuing operations
Add: Discounted operations:
Income from operations of discounted component(2,400*40 %)
Income Tax expense($ 960*40 %)
Income on discounted operation
-
-
-
-
$ 3,200
$ 1,500
-
-
-
-
-
-
$ 960
$ 384
-
$ 25,000
($ 14,000)
$ 11,000
-
-
($ 4,700)
$ 6,300
($ 220)
$ 6,080
($ 2,432)
$ 3,648
-
-
-
$ 1,344
Net Income $ 4,992

Earnings per share

Details Amount
Income from continuing operation
Income from discontinuing opearations
($ 6,080/600)
($ 3,648/600)
10.13
6.08
EPS 16.21

Learn more about this topic:

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Preparing Standard Cost Income Statements

from Accounting 301: Applied Managerial Accounting

Chapter 13 / Lesson 5
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