Prepare income statement and analysis of retained earnings, Financial Accounting

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You are preparing and income statement and analysis of retained earnings for Pacioli Wholesale Corporation for the years ended June 30, 2011 and 2012 based on the following information:

a. Sales for the year ended 6/30/11 were $1,289,040 and grew by 10% in the following year

b. Cost of goods sold is 60% of sales in both years.

c. Selling expense was $128,544 for YE 6/30/11 and went up by 8% the following year.

d. Administrative expense was $301,008 in the YE 6/30/11 and went up by 6% the following year.

e. Interest expense was $48,644 for YE 6/30/11 but the company managed to reduce this expense by 10% the following year.

f. Income taxes are 35% of pre-tax income in both years.

g. Retained earnings at 6/30/2010 was $265,080.

h. There were 10,000 shares which paid a $1.00 dividend per share in the 6/30/2011 year.

i. The following year, 1,000 more shares were issued and dividend of $1.50 was paid.

 


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