Homework SoursePrepare an income statement for Franklin Kite Co Take your c
Prepare an income statement for Franklin Kite Co. Take your calculations all the way to computing earnings per share. (Round EPS answer to 2 decimal places.)
| Sales | $ | 1,110,000 |
| Shares outstanding | 186,000 | |
| Cost of goods sold | 550,000 | |
| Interest expense | 25,000 | |
| Selling and administrative expense | 42,000 | |
| Depreciation expense | 39,000 | |
| Preferred stock dividends | 84,000 | |
| Taxes | 112,000 | |
Solution
Income Statement of Franklin Kite Co.
| Particulars | Amount (in $) |
| Sales | 1110000 |
| Less: Cost of Goods Sold | (550000) |
| Gross Profit | 560000 |
| Less : Selling and administrative expense | (42000) |
| Less : Depreciation | (39000) |
| Operating Profit | 479000 |
| Less: Interest Expense | (25000) |
| Earnings before tax | 454000 |
| Less : Taxes | (112000) |
| Earnings after tax | 342000 |
| Less: Preferred Stock Dividend | (84000) |
| Earnings available to Equity Shareholders (A) | 258000 |
| Shares Outstanding (B) | 186000 |
| Earnings Per Share (A / B) | 1.39 |
