ACCOUNTING
Presented below is information related to Michelle Company.
Retained earnings, December 31, 2010 $ 2,750,000
Sales 2,000,000
Selling and administrative expenses 240,000
Hurricane loss (pre-tax) on plant (extraordinary item) 250,000
Cash dividends declared on common stock 33,600
Cost of goods sold 960,000
Gain resulting from computation error 2,000,000
on depreciation charge in 2009 (pre-tax)
Other revenue 80,000
Other expenses 50,000
Instructions
Prepare in good form a multiple-step income statement for the year 2011. Assume a 30% tax rate and that 100,000 shares of common stock were outstanding during the year.
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