Selected account balances from the adjusted trial balance for Zen Corporation as of its calendar year-end December 31, 2011, follow.

Required
Answer each of the following questions by providing supporting computations.
1. Assume that the company€™s income tax rate is 30% for all items. Identify the tax effects and after-tax amounts of the four items labeled pretax.
2. What is the amount of income from continuing operations before income taxes? What is the amount of the income taxes expense? What is the amount of income from continuing operations?
3. What is the total amount of after-tax income (loss) associated with the discontinued segment?
4. What is the amount of income (loss) before the extraordinary items?
5. What is the amount of net income for theyear?

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Deblt Credit a. Income taxes expens. b. Correction of overstatement of prior year's sales (pretax) 7,000 24,750 d. Loss from settlement of lawsult .. e. Other operating expenses f. Accumulated depreclation-Machinery g. Galn from settlement of lawsuit h. Accumulated depreclation-Buldings l. Loss from operating a discontinued segment (pretax) I. Galn on Insurance recovery of tornado damage (pretax and extraordinary) k. Net sales. L. Depreclation expense Buildings .107,400 $ 72,600 45,000 175,500 19,250 30,120 999,500 53,000 35,000 ontinued segments assets n. Galn on sale of disc o. Accounts payable ..._... p. Interest revenue . q. Cost of goods sold (pretax) . 35,000 45,000 5,000 483,500