Question

The trial balance for Lindor Corporation, a manufacturing company, for the year ended December 31, 2021, included the following accounts: Account Title Debits Credits Sales revenue 2,580,000 Cost of goods sold 1,530,000 Selling and administrative expense 437,000 Interest expense 53,000 Gain on debt securities 93,000 The gain on debt securities is unrealized and classified as other comprehensive income. The trial balance does not include the accrual for income taxes. Lindor's income tax rate is 25%. There were 1,300,000 shares of common stock outstanding throughout 2021. Required: Prepare a single, continuous multiple-step statement of comprehensive income for 2021, including appropriate EPS disclosures. (Round EPS answer to 2 decimal places.)

Answer 1

Answer:

Prepare a single, continuous multiple-step statement of comprehensive income for 2021

                                                                                         $

Sales revenue                                                           2,580,000

Less Cost of goods sold                                          (1,530,000)

Gross Profit                                                                1,050,000

Less Expenses

Selling and administrative expense                          (437,000)

Interest expense                                                           (53,000)

Gain on debt securities                                                 93,000

Profit before tax                                                          653,000

Income tax expense at 25%                                      (163,250)

Profit for the year after tax                                          489,750

Earnings Per Share (EPS)                                              $0.38

Explanation:

Note : The Earnings Per Share (EPS) is disclosed on the face of the statement of comprehensive income not in the notes to financial statements as shown above.

Earnings Per Share (EPS) = Net Profit Attributable to Holders of Common Stock / Weighted Average Number of Common Stocks

                                          = $489,750 / 1,300,000

                                          = $0.3767307

                                          = $0.38 ( 2 decimal places.)