The following incorrect income statement was prepared by the accountant of the Axel Corporation: AXEL CORPORATIONIncome StatementFor the Year Ended December 31, 2021Revenues and gains: Sales revenue $592,000Interest revenue 32,000Gain on sale of investments 86,000Total revenues and gains 710,000Expenses and losses: Cost of goods sold$325,000 Selling expense 67,000 Administrative expense 87,000 Interest expense 16,000 Restructuring costs 55,000 Income tax expense 40,000 Total expenses and losses 590,000Net Income $120,000Earnings per share $1.20 Required:Prepare a multiple-step income statement for 2021 applying generally accepted accounting principles. The income tax rate is 25%. (Amounts to be deducted should be indicated with a minus sign. Round EPS answer to 2 decimal places.)

Particulars Amount($) Revenue: Sales…

Answered: The following incorrect income…

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter1: Introduction To Business Activities And Overview Of Financial Statements And The Reporting Process

Section: Chapter Questions

Problem 23E

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The following incorrect income statement was prepared by the accountant of the Axel Corporation:

AXEL CORPORATION Income Statement For the Year Ended December 31, 2021
Revenues and gains:
Sales revenue			$	592,000
Interest revenue				32,000
Gain on sale of investments				86,000
Total revenues and gains				710,000
Expenses and losses:
Cost of goods sold	$	325,000
Selling expense		67,000
Administrative expense		87,000
Interest expense		16,000
Restructuring costs		55,000
Income tax expense		40,000
Total expenses and losses				590,000
Net Income			$	120,000
Earnings per share			$	1.20

Required:
Prepare a multiple-step income statement for 2021 applying generally accepted accounting principles. The income tax rate is 25%. (Amounts to be deducted should be indicated with a minus sign. Round EPS answer to 2 decimal places.)

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