ABC Company is preparing its 20x8 financial statements. Income from Continuing Operations (ICO) for 20x8 was determined to be $1,800,000, but upon further review, ABC's accountant is not certain this number is accurate. ABC has a corporate tax rate of 30%. Additionally, the company reports one year of financial data on the face of the financial statements. Use the following information to determine the adjustments, if any, to correctly report Income From Continuing Operations 1. During 20x8, ABC experienced a labor strike which closed down the operations of one of its plants for an entire month. The pretax loss of $875,000 was excluded when determining Income from Continuing Operations because the bookkeeper was uncertain if this event qualified for discontinued operations, although the plant was re-opened after the strike was settled and did not represent a strategic shift in the on-going operations for ABC. Additionally, this plant did not qualify as a component of ABC. Determine the adjustment (if any) to correct Income from Continuing Operations (ICO) for the labor strike. S[Blank_1] "If you need to increase ICO, enter your answer as a positive number if you need to decrease ICO, enter your answer as a negative number using 0 parenthesis. If you determine that ABC treated the labor strike correctly and that ICO does not need to be adjusted, enter NE for No Effect. You do not need to record your answer using S signs or commas. Continuing with the information presented in 19 above, ABC has ICO of $1.800.000 and a corporate tax rate of 30% Determine if ICO should be adjusted based on the following information: On October 1, 2016. ABC received $360,000 cash in advance for the sale of merchandise to a customer. The contract specified that ABC would deliver their product in equal monthly quantities over the next five years. When ABC recorded the sale, the bookkeeper credited Sales Revenue. No adjusting or correcting entries were made although ABC has fulfilled their obligation to delivering the goods as stipulated in the contract. ABC did not realize the error until after the 20x8 Income from Continuing Operations was calculated at $1,800,000 a. Determine the adjustment for Sales Revenue affecting ICO for 20x8:S b. Determine the effect of this error on Retained Earnings (if any): $ "If you need to increase ICO,anter your answer as a positive number if you need to decrease iCO, enter your answer as a negative number using parenthesis. Il you determine that ABC treated the transaction correctly and that I does not need to be adjusted, enter NE for No Effect. You do not need to record your answer using signs or commas ABC Company is preparing its 20x8 financial statements. Income from Continuing Operations (ICO) for 20x8 was determined to be $1,800,000, but upon further review, ABC's accountant is not certain this number is accurate. ABC has a corporate tax rate of 30%. Additionally, the company reports one year of financial data on the face of the financial statements. Use the following information to determine the adjustments, if any, to correctly report Income From Continuing Operations. 1. During 20x8, ABC experienced a labor strike which closed down the operations of one of its plants for an entire month. The pretax loss of $875,000 was excluded when determining Income from Continuing Operations because the bookkeeper was uncertain if this event qualified for discontinued operations, although the plant was re-opened after the strike was settled and did not represent a strategic shift in the on-going operations for ABC. Additionally, this plant did not qualify as a component of ABC. Determine the adjustment (if any) to correct Income from Continuing Operations (ICO) for the labor strike. $[Blank_1] *If you need to increase ICO, enter your answer as a positive number: If you need to decrease ICO, enter your answer as a negative number using ( parenthesis. If you determine that ABC treated the labor strike correctly and that ICO does not need to be adjusted, enter NE for No Effect. You do not need to record your answer using $ signs or commas. Continuing with the information presented in #9 above, ABC has ICO of $1,800,000 and a corporate tax rate of 30%. Determine if ICO should be adjusted based on the following information: On October 1, 20x6, ABC received $360,000 cash in advance for the sale of merchandise to a customer. The contract specified that ABC would deliver their product in equal monthly quantities over the next five years. When ABC recorded the sale, the bookkeeper credited Sales Revenue. No adjusting or correcting entries were made although ABC has fulfilled their obligation to delivering the goods as stipulated in the contract. ABC did not realize the error until after the 20x8 Income from Continuing Operations was calculated at $1,800,000. a. Determine the adjustment for Sales Revenue affecting ICO for 20x8: $ b. Determine the effect of this error on Retained Earnings (if any): $ "If you need to increase ICO, enter your answer as a positive number: if you need to decrease ICO, enter your answer as a negative number using ( parenthesis. Il you determine that ABC treated the transaction correctly and that ICO does not need to be adjusted, enter NE for No Effect. You do not need to record your answer using $ signs or commas
