Nathan Corporation's Accounting Records Include the Following Items for the Year

question 75

Essay

Nathan Corporation's accounting records include the following items for the year ending December 31,2018:
$$\begin{array} { l l l } \text { Gain on Sale of Equipment } & \$ 12,000 & \text { Gain on } \\\text { Discontinued Operations } & \$ 75,000 & \\\text { Loss on Disposal of Equipment } & 5,000 \mathrm { Net } \text { Sales } & \text { 650,000 } \\\text { Cost of Goods Sold } & 285,000 & \text { Operating } \\\text { Expenses } & 120,000 &\end{array}$$ The income tax rate for the company is 45%.The company had 15,000 shares of common stock outstanding during 2018 and no preferred stock.Prepare Nathan's income statement for the year ending December 31,2018.Show how Nathan reports EPS data on its 2018 income statement.

---

Definitions:

Profit Margin

A financial metric that measures the percentage of revenue that exceeds the cost of goods sold, indicating the profitability of a business.

Net Income

The profit of a company after all expenses and taxes have been subtracted from total revenue.

Dollar of Sales

The total monetary value of sales transactions completed over a specific period.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations with its current assets relative to its current liabilities.