Question
Company Inc. owned the following business operations for all or part of the current year. 3 warehouses: Northern, Western, and Eastern. a retail store an
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Company Inc. owned the following business operations for all or part of the current year.
- 3 warehouses: Northern, Western, and Eastern.
- a retail store
- an amusement park
- a music recording studio
Note: this content is copyrighted. The 3 warehouse operations together (Northern, Western, and Eastern combined) are considered to be a single business component. The retail store, amusement park and music operations are each separate business components. (Note, there is a total of 4 business components.)
Company sold the Western warehouse operation at the beginning of the year and had a loss of $30,000 on the sale. Company sold the amusement park operation at the beginning of the year and had a gain of $25,000 on the sale. Assume both sales represent strategic shifts for Company.
How will the gain and loss be reported on the income statement?
A. the gain and loss are both reported as discontinued operations
B. the gain and loss are both reported as other comprehensive income
C. the gain is a discontinued operation; the loss is part of net income from continuing operations
D. the gain is part of net income from continuing operations; the loss is a discontinued operation
Company Inc. owned the following business operations for all or part of the current year.
- 3 warehouses: Northern, Western, and Eastern.
- a retail store
- an amusement park
- a music recording studio
Note: this content is copyrighted. The 3 warehouse operations together (Northern, Western, and Eastern combined) are considered to be a single business component. The retail store, amusement park and music operations are each separate business components. (Note, there is a total of 4 business components.)
Company sold the Western warehouse operation at the beginning of the year and had a loss of $30,000 on the sale. Company sold the amusement park operation at the beginning of the year and had a gain of $25,000 on the sale. Assume both sales represent strategic shifts for Company.
How will the gain and loss be reported on the income statement?
| A. | the gain and loss are both reported as discontinued operations | |
| B. | the gain and loss are both reported as other comprehensive income | |
| C. | the gain is a discontinued operation; the loss is part of net income from continuing operations | |
| D. | the gain is part of net income from continuing operations; the loss is a discontinued operation |
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Canadian Income Taxation Planning And Decision Making
Authors: Joan Kitunen, William Buckwold
17th Edition 2014-2015 Version
1259094332, 978-1259094330
