1.Lupton Inc. disposes of an unprofitable segment of its business. The operation of the segment suffered a $200000 loss in the year of disposal. The loss on disposal of the segment was $100000. If the tax rate is 30%, and income before income taxes was $1600000,

a	the losses from discontinued operations are reported net of income taxes at $300000.

b	the income tax expense on the income before discontinued operations is $390000.

c the income from continuing operations is $1120000.

d net income is $1300000.

2.During 2017, Ecuyer Industries reported cash provided by operations of $794000, cash used in investing of $686000, and cash used in financing of $190000. In addition, cash spent for fixed assets during the period was $2276000. Average current liabilities were $650000 and average total liabilities were $1716000. No dividends were paid. Based on this information, what was Ecuyer's free cash flow?

a

$-604000.

b

$144000.

c

$108000.

d	d. $518000. 3. If a company has a discontinued operation gain of $30000 and a 32% tax rate, what is the effect on net income?