Question
Fax Inc. earned $90,000 and $110,000 of income from continuing operations after taxes in Years 1 and 2, respectively. The tax rate is 40%. The
Fax Inc. earned $90,000 and $110,000 of income from continuing operations after taxes in Years 1 and 2, respectively. The tax rate is 40%. The firm decided to sell one of its business segments on November 1, Year 1. The expected disposal date is February 1, Year 2. The segment's income was a pre-tax loss of $20,000 (not included in income from continuing operations) for Year 1 through November 1, Year 1. However, the segment earned $30,000 pre-tax income for the remainder of Year 1 and was expected to earn $25,000 pre-tax in Year 2 to the disposal date. The selling price of the segment is $100,000 and the book value of net assets is $80,000. During Year 2, the segment actually earned $35,000 pre-tax. Required For both years, prepare the bottom portion of the Statement of Comprehensive Income including a section for discontinued operations for this firm. Assuming all of the above items are subject to the average tax rate of 30%, prepare in proper form, a Statement of Comprehensive Income for the year ended December 31, Year 1. Fax Inc. earned $90,000 and $110,000 of income from continuing operations after taxes in Years 1 and 2, respectively. The tax rate is 40%. The firm decided to sell one of its business segments on November 1, Year 1. The expected disposal date is February 1, Year 2. The segment's income was a pre-tax loss of $20,000 (not included in income from continuing operations) for Year 1 through November 1, Year 1. However, the segment earned $30,000 pre-tax income for the remainder of Year 1 and was expected to earn $25,000 pre-tax in Year 2 to the disposal date. The selling price of the segment is $100,000 and the book value of net assets is $80,000. During Year 2, the segment actually earned $35,000 pre-tax. Big Dog Corp is developing financial statements for the year ended December 31, Year 1. The average tax rate is 30%. The following pre-tax information is available:
question: For both years, prepare the bottom portion of the Statement of Comprehensive Income including a section for discontinued operations for this firm
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