BE4.1 (LO2) Starr Ltd. had sales revenue of £540,000 in 2019. Other items recorded during the year were:
Cost of goods sold £330,000
Selling expenses 120,000
Income tax 25,000
Increase in value of employees 15,000
Administrative expenses 10,000
Selling expenses 120,000
Income tax 25,000
Increase in value of employees 15,000
Administrative expenses 10,000
Prepare an income statement for Starr for 2019. Starr has 100,000 shares outstanding.
Answer
STARR CO.
Income Statement
For the Year 2014
Revenues
Sales revenue................................$540,000
Expenses
Cost of goods sold................$330,000
Selling expenses...................120,000
Administrative expenses.............10,000
Administrative expenses.............10,000
Income tax..........................25,000
Total Expenses..............................485.000
Net income...................................$ 55,000
Earnings per share.............................$0.55*
*$55,000 ÷ 100,000 shares.
Note: The Increase in value of employees are not reported.