Barkin Corporation's accounting records include the following items for the year ending December 31, 2017
Gain on Sale of Equipment $12,000 Gain on Discontinued Operations $75,000
Loss on Disposal of Equipment 5,000 Extraordinary Loss 15,000
Net Sales 650,000 Cost of Goods Sold 285,000
Operating Expenses 120,000
The income tax rate for the company is 25%. Prepare Barkin's income statement for the year ended December 31, 2017. Omit earnings per share.
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Barkin Corporation
Income Statement
Year Ended December 31, 2017
Net Sales $650,000
Cost of Goods Sold 285,000
Gross Profit 365,000
Operating Expenses 120,000
Operating Income 245,000
Other Revenues and (Expenses):
Gain on Sale of Equipment 12,000
Loss on Disposal of Equipment (5,000 )
Income Before Income Taxes 252,000
Income Tax Expense ($252,000 x 25%) 63,000
Income from Continuing Operations 189,000
Discontinued Operations Gain (less applicable tax
$75,000 x 25% = $18,750 ) 56,250
Income before Extraordinary Items 245,250
Extraordinary Loss (less applicable tax saving $15,000 x 25% = $3,750 ) (11,250 )
Net Income $234,000
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