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CoursHeroTranscribedText: Selected information about income statement accounts for the Reed Company is presented below [the company's scal year ends on December 31}: 2021 2020 Sales revenue $5.300, 000 $0,400,000 Coat of goods sold 3,040,000 2,100,000 Administrative expense 980. 000 855. non Selling expense 540,000 402,000 Interest revenue 160,000 150,000 Interest expense 230,000 236,000 Loss on sale of assets of discontinued component 120,000 On July 1, 2021r the company adopted a plan to discontinue a division that qualies as a component of an entity as dened by 6MP. The assets of the component were sold on September 30, 2021, for $120,000 less than their book value. Results of operations for the component (included in the above account balances] were as follows: lflfzllBISUIZOZI 2020 Sales revenue 5 580.000 5 680,000 Coat of goods sold {300,000} {423,000} Administrative expense {53.0001 [53.0001 Selling expense {33,000} (33,000} Operating income before taxes 5 94.000 5 156,000 In addition to the acc0unt balances above. several events occurred during 2021 that have not yet been reected in the above accounts: 1. A re caused $68,000 in uninsured damages to the main office building. The re was considered to be an unusual event. 2, Inventory that had cost $58,000 had become obsolete because a competitor introduced a better product. The inventory was written down to its scrap value 0115.000. 3. Income taxes have not yet been recorded. Required: Prepare a multiple-step income statement for the Reed Company for 2021. showing 2020 information in comparative format. including income taxes computed at 25% and EPS disclosures assuming 600,000 shares of outstanding common stock. [Amounts to be deducted should be Indicated Milt a min us sign. Round BPS answers to 2 decimal pl aces.) REED COMPANY Comparative Income Statements For the Years Ended December 31 2021 2020 Sales revenue $ 4,720,000 $ 3,720,000 Cost of goods sold (2,660,000) (1,752,000 Gross profit (loss) 2,060,000 1,968,000 Operating expenses Administrative expense 912,000 (797,000) Selling expense (502,000) (444,000) Total operating expenses 1,414,000) (1,241,000) Operating income 646,000 727,000 Other income (expense): Interest revenue 68,000 158.000 Interest expense (236,000 (236,000) Total other income, net (68,000 (78,000) Income from continuing operations before income taxes Loss on inventory write-down Income from continuing operations 0 Discontinued operations: Income from operations of discontinued component Income (loss) on discontinued operations 0 Net income $ o $ Earnings per share: Income from continuing operations Income on discontinued operations Net income

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