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Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31):

		2021		2020
Sales revenue	$	4,400,000	$	3,500,000
Cost of goods sold		2,860,000		2,000,000
Administrative expense		800,000		675,000
Selling expense		360,000		302,000
Interest revenue		150,000		140,000
Interest expense		200,000		200,000
Loss on sale of assets of discontinued component		48,000

On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of an entity as defined by GAAP. The assets of the component were sold on September 30, 2021, for $48,000 less than their book value. Results of operations for the component (included in the above account balances) were as follows:

	1/1/20219/30/2021						2020
Sales revenue		$	400,000				$	500,000
Cost of goods sold			(290,000	)				(320,000	)
Administrative expense			(50,000	)				(40,000	)
Selling expense			(20,000	)				(20,000	)
Operating income before taxes		$	40,000				$	120,000

In addition to the account balances above, several events occurred during 2021 that have not yet been reflected in the above accounts:

1. A fire caused $50,000 in uninsured damages to the main office building. The fire was considered to be an unusual event.
2. Inventory that had cost $40,000 had become obsolete because a competitor introduced a better product. The inventory was written down to its scrap value of $5,000.
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 300,000 shares of outstanding common stock. (Amounts to be deducted should be indicated with a minus sign. Round EPS answers to 2 decimal places.)

I am having trouble figuring out the last part of this. Please show how you get the answer.

REED COMPANY Comparative Income Statements For the Years Ended December 31 2021 2020 Sales revenue $4,000,000 3,000,000 Cost of goods sold 2,570,000 1,680,000 Gross profit (loss) Operating expenses: 1,430,000 1,320,000 Administrative expense 750,000 635,000 Selling expense 340,000 282,000 Loss on building (fire damage) 50,000 Loss on inventory write-down 35,000 Total operating expenses 1,175,000 917,000 Operating income Other income (expense) 255,000 403,000 Interest revenue 150,000 140,000 Interest expense (200,000) (200,000) Total other income, net (50,000) (60,000) Income from continuing operations before income taxes 343,000 205,000 Income tax expense 51,250 85,750 Income from continuing operations Discontinued operations: 257,250 153,750 Income from operations of discontinued component (8,000) 120,000 Income tax benefit 2,000 (30,000) Income (loss) on discontinued operations Net income Earnings per share Income from continuing operations Income on discontinued operations Net income (6,000) 90,000 $ 347,250 $ 147,750

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