Problem 41 Part Level Submission The following information i

Problem 4-1 (Part Level Submission)

The following information is related to Marigold Company for 2017.

Marigold Company decided to discontinue its entire wholesale operations (considered a discontinued operation) and to retain its manufacturing operations. On September 15, Marigold sold the wholesale operations to Rogers Company. During 2017, there were 529,100 shares of common stock outstanding all year.

Prepare a multiple-step income statement. (Round earnings per share to 2 decimal places, e.g. 1.49.)

Retained earnings balance, January 1, 2017		$988,590
Sales Revenue		26,102,600
Cost of goods sold		16,294,600
Interest revenue		79,900
Selling and administrative expenses		4,770,300
Write-off of goodwill		822,300
Income taxes for 2017		1,270,500
Gain on the sale of investments		120,100
Loss due to flood damage		392,700
Loss on the disposition of the wholesale division (net of tax)		448,400
Loss on operations of the wholesale division (net of tax)		86,500
Dividends declared on common stock		239,900
Dividends declared on preferred stock		72,850

Solution

Marigold Company INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2017 Sales Revenue Net sales 26,102,600 Cost of goods sold 16,294,600 Gross profit 9,808,000 Operating Expenses Selling and administrative expenses 4,770,300 Income from operations 5,037,700 Other Revenues and Gains Interest revenue 79,900 Gain on the sale of investments 120,100 200,000 5,237,700 Other Expenses and Losses Write-off of goodwill 822,300 Income before taxes and extraordinary items 4,415,400 Income taxes 1,270,500 Income before extraordinary items 3,144,900 Extraordinary items Loss due to flood damage – extraordinary item 392,700 Loss on the disposition of the wholesale division 86,500 Loss on operations of the wholesale division 86,500 565,700 Net income 2,579,200 Per share of common stock Income before extraordinary items 5.94 3144900/529100 Extraordinary loss net of tax -1.07 565700/529100 Net income 4.87 2579200/529100