udmoodleudacae Question 2 Preparation and Presentation of th

udmoodle.ud.ac.ae Question 2: Preparation and Presentation of the Income Statement In your new position as chief financial officer for Gulf Barges Limited, the first task you have been assigned to complete is to prepare the income statement for the 12-month period ended June 30, 2022. On your desk on your first day, the previous chief financial officer has left you valuable information to complete the task 1. Total revenue recorded by Gulf Barges Limited during the accounting period was $185,852,000. Included in the total revenue figure is Other Revenue totalling $21,050,000 and Interest Income totalling $2,453,000 2. Following is a list of expenses incurred by the company ecount and Market Overhcad hrect Labour irect Matcrial 560,000.o 561,000.0 e and Utilities ffice $590,000.0 $1.457,0000 and alaries to Administrative Staff S$6, 801,000.0 ies Commis Travel Costs 1 260,000 3. On January 1, 2022, the company sold a block of land held for investment and recognized a gain on the sale of $12,861,000. 4. On April 1, 2022, the company sold equipment that 5. The company incurred finance interest charges during the 6. The company is involved in joint venture operations. As a resulted in a loss of $4.891,000 accounting period of S14,890,000 result of poor financial conditions, the company net loss of S15,069,000 from its share of the joint venture operations. recorded a 7. From the operations of its associate firms, the company recorded a net gain of $4,287,000 for the financial period ended June 30, 2022 8. If the company reports a profit during the year, the effective corporate tax rate is 25%. If a loss is reported the effective tax rate is zero.

Solution

Sales revenue       16,23,49,000 cost of goods sold        -7,59,37,000 gross profit          8,64,12,000 selling and distribution expense        -2,53,69,000 Administration expenses        -1,05,38,000 other income          2,10,50,000 gain on sale of land          1,28,61,000 loss on sale of equipment           -48,91,000 impairment loss             72,00,000 operating profit          7,23,25,000 finance revenue             24,53,000 finance and interest charges        -1,48,90,000 net finance costs        -1,24,37,000 share of net gain from associate firms             42,87,000 share of net loss from joint venture        -1,50,69,000 profit before income tax          4,91,06,000 income tax        -1,22,76,500 profit after income tax          3,68,29,500 Expense Amount Grouping Insurance and utilities           16,90,000 Administration expenses Office supplies              5,90,000 Administration expenses Repairs           14,57,000 Administration expenses Salaries to adm           68,01,000 Administration expenses OH        1,54,83,000 cost of goods sold DL        4,78,94,000 cost of goods sold DM        1,25,60,000 cost of goods sold Advt           25,12,000 selling and distribution expense Entertinement              5,61,000 selling and distribution expense Sales commission        2,10,36,000 selling and distribution expense Travel costs           12,60,000 selling and distribution expense selling and distribution expense        2,53,69,000 Administration expenses        1,05,38,000 cost of goods sold        7,59,37,000