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Comparative Income Statement Preparation

Listed below are the results of Rulon Candies' operations for 2005 and 2006. (Assume 4,000 shares of outstanding stock for both years.)

2006 2005
Sales $300,000 $350,000

Utilities expenses 15,000 8,500

Employee salaries 115,000 110,000

Advertising expenses 10,000 20,000

Income tax expense 9,000 36,500

Interest expense 25,000 15,000

Cost of goods sold 115,000 85,000

Interest revenue 10,000 10,000

Prepare a comparative income statement for Rulon Candies, Inc., for the years ended December 31, 2006, and 2005. Be sure to include figures for gross margin, operating income, income before taxes, net income, and earnings per share.

Solution Summary

The solution explains how to prepare a comparative income statement. It is provided in an attached Excel file.

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