MacInnes Ltd., a private company based in Kingston, decided to sell its Interior Design Division. After two years of losses and heavy competition, a plan to dispose of the division was put in place. At the end of 2020, the plan was finalized and approved by the board of directors. The sale is anticipated to be completed by June 30, 2021.

Other information:

1. MacInnes' 2020 after-tax net income (excluding the results from the Interior Design Division) was $450,000.

2. During the year, the division reported an after-tax loss of $120,000 (revenues: $30,000, expenses: $150,000).

3. Management estimates that after-tax legal and audit fees of $32,000 as well as severance payments of $66,000 will be required to finalize the disposal plan. A portion of these costs is expected to be offset by the after-tax proceeds of $61,000 from the sale of the division's assets.

Instructions

Assuming the Interior Design Division qualifies for treatment as a discontinued operation in 2020, prepare a partial income statement for MacInnes for 2020, in good format. The statement should begin with income from continuing operations and include an appropriate footnote pertaining to the disposal of the Interior Design Division. Show all calculations.