Single-step income statement Presented below is an income statement for Morton Company for the year

Single-step income statement Presented below is an income statement for Morton Company for the year ended December 31,2007.

Morton Company

Income Statement

For the Year Ended December 31, 2007

Net sales $800,000 Costs and expenses Cost of goods sold 640,000 Selling, general, and administrative expenses 70,000 Other, net 20,000 Total costs and expenses 730,000 Income before income taxes 70,000 Income taxes 21,000 Net income $49,000

Additional information:

1. "Selling, general, and administrative expenses" included a usual but infrequent charge of $7,000 due to a loss on the sale of investments.

2. "Other, net" consisted of interest expense,$10,000, and an extraordinary loss of $10,000 before taxes due to earthquake damage. If the extraordinary loss had not occurred, income taxes for 2007 would have been $24,000 instead of $21,000.

3. Morton had 20,000 shares of common stock outstanding during 2007.

Instructions

Using the single-step format, prepare a corrected income statement, including the proper disclosure of special items and appropriate per share disclosures.

 

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