Maulder Corporation has income from continuing operations of $290,000 for the year Prepare income statement.

ended December 31, 2014. It also has the following items (before considering income taxes). (LO 6)

1. An extraordinary loss of $70,000.

2. A gain of $35,000 on the discontinuance of a division.

3. A correction of an error in last year’s financial statements that resulted in a $25,000 understatement of 2013 net income.

Assume all items are subject to income taxes at a 30% tax rate.

Instructions

(a) Prepare an income statement, beginning with income from continuing operations.

(b) Indicate the statement presentation of any item not included in

(a) above.