The following income statement items appeared on the adjustedtrial balance of Schembri Manufacturing Corporation for the yearended December 31, 2016 ($ in 000s): sales revenue, $19,100; costof goods sold, $8,100; selling expenses, $1,490; general andadministrative expenses, $990; interest revenue, $250; interestexpense, $220. Income taxes have not yet been recorded. Thecompanyâs income tax rate is 30% on all items of income or loss.These revenue and expense items appear in the companyâs incomestatement every year. The companyâs controller, however, has askedfor your help in determining the appropriate treatment of thefollowing nonrecurring transactions that also occurred during 2016($ in 000s). All transactions are material in amount.

1.
Investments were sold during the year at a loss of $410.Schembri also had unrealized gains of $510 for the year oninvestments.

2. One of the companyâs factorieswas closed during the year. Restructuring costs incurred were$2,200.

3.
During the year, Schembri completed the sale of one of itsoperating divisions that qualifies as a component of the entityaccording to GAAP. The division had incurred a loss from operationsof $700 in 2016 prior to the sale, and its assets were sold at again of $1,700.

4.
In 2016, the companyâs accountant discovered that depreciationexpense in 2015 for the office building was understated by$390.

5. Foreign currency translationlosses for the year totaled $430.

Required:

1.
Prepare Schembriâs single, continuous multiple-step statement ofcomprehensive income for 2016, including basic earnings per sharedisclosures. One million shares of common stock were outstanding atthe beginning of the year and an additional 800,000 shares wereissued on July 1, 2016. (Amounts to be deducted should beindicated with a minus sign. Enter your answers in thousands. RoundEPS answers to 2 decimal places.)

2.
Prepare a separate statement of comprehensive income for 2016.(Amounts to be deducted should be indicated with a minussign. Enter your answers in thousands.)

Question

The following income statement items appeared on the adjustedtrial balance of Schembri Manufacturing Corporation for the yearended December 31, 2016 ($ in 000s): sales revenue, $19,100; costof goods sold, $8,100; selling expenses, $1,490; general andadministrative expenses, $990; interest revenue, $250; interestexpense, $220. Income taxes have not yet been recorded. Thecompanyâs income tax rate is 30% on all items of income or loss.These revenue and expense items appear in the companyâs incomestatement every year. The companyâs controller, however, has askedfor your help in determining the appropriate treatment of thefollowing nonrecurring transactions that also occurred during 2016($ in 000s). All transactions are material in amount.

1.	Investments were sold during the year at a loss of $410.Schembri also had unrealized gains of $510 for the year oninvestments.
2.	One of the companyâs factorieswas closed during the year. Restructuring costs incurred were$2,200.
3.	During the year, Schembri completed the sale of one of itsoperating divisions that qualifies as a component of the entityaccording to GAAP. The division had incurred a loss from operationsof $700 in 2016 prior to the sale, and its assets were sold at again of $1,700.
4.	In 2016, the companyâs accountant discovered that depreciationexpense in 2015 for the office building was understated by$390.
5.	Foreign currency translationlosses for the year totaled $430.

Required:

1.

Prepare Schembriâs single, continuous multiple-step statement ofcomprehensive income for 2016, including basic earnings per sharedisclosures. One million shares of common stock were outstanding atthe beginning of the year and an additional 800,000 shares wereissued on July 1, 2016. (Amounts to be deducted should beindicated with a minus sign. Enter your answers in thousands. RoundEPS answers to 2 decimal places.)

2.	Prepare a separate statement of comprehensive income for 2016.(Amounts to be deducted should be indicated with a minussign. Enter your answers in thousands.)

TOWNE COMPANY Income Statement For the Year Ended December 31, 2016
Service Fees Earned		$317,000
Dividend and Interest Income		14,000
		$331,000
Wages and Other Operating Expenses	$285,000
Depreciation Expense	55,000
Franchise Amortization Expense	10,000
Loss on Sale of Equipment	7,000
Gain on Sale of Investments	(17,000)	340,000
Net Loss		$(9,000)

TOWNE COMPANY Balance Sheets
	Dec. 31, 2016	Dec. 31, 2015
Assets
Cash	$43,000	$33,000
Accounts Receivable	13,000	18,000
Interest Receivable	-	4,000
Prepaid Expenses	16,000	10,000
Long-term InvestmentsâAvailable for Sale	-	70,000
Fair Value Adjustment to Investments	-	10,000
Plant Assets	696,000	655,000
Accumulated Depreciation	(237,000)	(185,000)
Franchise	91,000	29,000
Total Assets	$622,000	$644,000

Liabilities and Stockholdersâ Equity
Accrued Liabilities	$12,000	$14,000
Notes Payable	-	26,000
Common Stock ($10 par value)	595,000	535,000
Retained Earnings	35,000	59,000
Unrealized Gain on Investments	-	10,000
Treasury Stock	(20,000)	-
Total Liabilities and Stockholdersâ Equity	$622,000	$644,000

TOWNE COMPANY Statement of Cash Flows For Year Ended December 31, 2016
Cash Flow from Operating Activities
Net Loss		$Answer
Add (deduct) items to convert net income to cash basis
Depreciation		Answer
Franchise Amortization		Answer
Loss on Sale of Equipment		Answer
Gain on Sale of Investments		Answer
Accounts Receivable	AnswerIncreaseDecrease	Answer
Interest Receivable	AnswerIncreaseDecrease	Answer
Prepaid Expenses	AnswerIncreaseDecrease	Answer
Accrued Liabilities	AnswerIncreaseDecrease	Answer
Cash Provided by Operating Activities		Answer

Cash Flow from Investing Activities
Sale of Equipment		Answer
Sale of Investments		Answer
Extension of Franchise		Answer
Cash Provided by Investing Activities		Answer

Cash Flow from Financing Activities
Payment of Notes Payable		Answer
Payment of Dividends		Answer
Purchase of Treasury Stock		Answer
Cash Used by Financing Activities		Answer
Net in Cash AnswerIncreaseDecrease		Answer
Cash at Beginning of Year		Answer
Cash at End of Year		$Answer

ARDUOUS COMPANY Comparative Balance Sheets December 31, 2016 and 2015 ($ in millions)
	2016		2015
Assets
Cash	$	154	$	100
Accountsreceivable		209		232
Investment revenuereceivable		25		23
Inventory		226		219
Prepaidinsurance		23		32
Long-terminvestment		213		144
Land		234		169
Buildings andequipment		431		438
Less: Accumulateddepreciation		(117)		(158)
Patent		53		56

	$	1,451	$	1,255

Liabilities
Accountspayable	$	69	$	103
Salariespayable		25		37
Bond interestpayable		27		23
Income taxpayable		31		38
Deferred income taxliability		49		27
Notes payable		32		0
Lease liability		101		0
Bonds payable		234		313
Less: Discount onbonds		(41)		(46)
Shareholdersâ Equity
Common stock		465		429
Paid-incapitalâexcess of par		119		104
Preferred stock		94		0
Retainedearnings		274		227
Less: Treasury stock		(28)		0

	$	1,451	$	1,255

ARDUOUS COMPANY Income Statement For Year Ended December 31, 2016 ($ in millions)
Revenues
Sales revenue	$	589
Investmentrevenue		30
Gain on sale oftreasury bills		2	$	621

Expenses andloss:
Cost of goodssold		199
Salariesexpense		92
Depreciationexpense		13
Patent amortizationexpense		2
Insuranceexpense		26
Bond interestexpense		47
Loss on machinedamage		34
Income taxexpense		55		468

Netincome			$	153

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Additionalinformation from the accounting records:
a.	Investment revenue includes Arduous Companyâs $25 million shareof the net income of Demur Company, an equity method investee.
b.	Treasury bills were sold during 2016 at a gain of $2 million.Arduous Company classifies its investments in Treasury bills ascash equivalents.
c.	A machine originally costing $108 million that was one-halfdepreciated was rendered unusable by a flood. Most major componentsof the machine were unharmed and were sold for $20 million.
d.	Temporary differences between pretax accounting income andtaxable income caused the deferred income tax liability to increaseby $22 million.
e.	The preferred stock of Tory Corporation was purchased for $44million as a long-term investment.
f.	Land costing $65 million was acquired by issuing $33 millioncash and a 10%, four-year, $32 million note payable to theseller.
g.	The right to use a building was acquired with a 15-year leaseagreement; present value of lease payments, $101 million.
h.	$79 million of bonds wereretired at maturity.
i.	In February, Arduous issued a 4% stock dividend (6 millionshares). The market price of the $6 par value common stock was$8.50 per share at that time. Also the company paid a cashdividend.
j.	In April, 1 million shares ofcommon stock were repurchased as treasury stock at a cost of $28.00million.

Required:
Prepare the statement of cash flows of Arduous Company for theyear ended December 31, 2016. Present cash flows from operatingactivities by the direct method. (Do not round yourintermediate calculations. Enter your answers in millions (i.e.,10,000,000 should be entered as 10.). Amounts to be deducted shouldbe indicated with a minus sign.)