PROBLEM:

From the following data for Nunn Company for the current fiscal year ended December 31, prepare a multiple-step income statement. Show parenthetically earnings per share for the following: income from continuing operations, loss on discontinued operations (less applicable income tax), income before extraordinary item, extraordinary item (less applicable income tax), and net income.

Common stock, $50 par $200,000
Cost of merchandise sold 255,000
Administrative expenses 51,000
Income tax (applicable to continuing operations) 144,000
Interest expense 4,000
Loss on discontinued operations,
net of applicable tax of $2,700 5,500
Sales 775,000
Selling expenses 83,000
Uninsured flood loss, net of applicable
income tax of $4,500 15,000