Answer:
<u>Requirement</u>
Prepare Income statement
Calculate the per share of common stock
Windsor Inc.
Income statement for the year ended December 31, 2017
Sales $3,775,000
Less: Cost of goods sold <u>$1,648,000</u>
Gross profit $2,127,000
<u>Operating expenses</u>
Selling expenses $876,000
Administrative expenses <u> $507000</u>
Total operative expenses <u>$1,383,000</u>
Operative income $744,000
Other revenues and (expenses):
Rent revenue $98000
Gain on sale of equipment $31000
Interest expenses ($57,000) <u>$72,000</u>
Income before income taxes $816,000
Income tax applicable to continuing <u>$297,000</u>
operations
income from continuing operations $519,000
Discontinued operations:
Loss on discontinued operations ($66000)
Income tax applicable to loss on <u>($23,000)</u>
discontinued operations
Total discontinued operations <u>$89,000</u>
Income before extraordinary item $430,000
Extraordinary item:
Loss on write-down of inventory <u>($37000)
</u>
Income after extraordinary item $393,000
Other comprehensive income:
Unrealized gain on available-for-sale securities <u>$27,000</u>
Comprehensive Income <u>$420,000</u>
<u>
</u>
EPS = Net Income of a company / Outstanding Shares
EPS = $420,000/200,000
EPS = $2.1 per share
