The following information was extracted from the 2020 financial statements of Sheridan Company:
Income from continuing operations before income tax $703500
Selling and administrative expenses 478000
Income from continuing operations 502000
Gross profit 1343000
Required:
a. Assuming that there are no other revenues and gains, amount reported for other expenses and losses is .
O $24000.
O $201500.
O $225500.
O $161500.

$161500.

Explanation:

a normal income statement should be:

total revenue                                                  x

- COGS                                                           (y)          

gross profit =                                              $1,343,000

- selling and administrative expenses =   ($478,000)

EBIT =                                                           $865,000

- interests paid, other expenses & losses =    

income before taxes                                   $703,500

- taxes                                                              (t)          

                                                                    net income                                              

other expenses and losses = $865,000 - $703,500 = $161,500

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