Income Statement Preparation


Accounts payable.. . $ 143,000
Accounts receivable.. . 95,000
Advertising expense.. . 14,500
Cash.. . 63,000
Supplies expense.. . 31,500
Rent expense.. . 12,000
Utilities expense.. . 2,500
Income taxes (30% of income before taxes)..
Miscellaneous expense.. . 5,100
Owners’ equity.. . 215,000
Salaries expense.. . 78,000
Fees (revenues).. . 476,000
1. Prepare an income statement for the year ended December 31, 2009. (Assume that
11,000 shares of stock are outstanding.)

My work so far... It doesn't look right and I can't figure it out. Can you help?[/B]

Income Statement
Fees (revenue) $476,000.00
Accounts Receivable $95,000.00
Accounts Payable $(143,000.00)
Cash $63,000.00
Advertising Expense $(14,500.00)
Supplies Expense $(31,500.00)
Rent Expense $(12,000.00)
Utilities Expense $(2,500.00)
Salaries Expense $(78,000.00)
Miscellaneous Expenses $(5,100.00)
Owners Equity $215,000.00


Net Income $562,400.00
Income taxes (30% of income before taxes) $168,720.00

Share Price $51.13

Accounts Receivable, Accounts Payable, Cash, and Owner's Equity are Balance Sheet items.

Remove those and recalculate your taxes and you will have the correct net income. Then divide by Shares outstanding to get earnings per share.

Quote:

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Originally Posted by Ks2867

Accounts Receivable, Accounts Payable, Cash, and Owner's Equity are Balance Sheet items.

Remove those and recalculate your taxes and you will have the correct net income. Then divide by Shares outstanding to get earnings per share.

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Thank You for your help. It makes sense now!