Question
On May 1, Foxtrot Company agreed to sell the assets of its Footwear Division to Albanese Incorporated for $80 million. The sale was completed on
On May 1, Foxtrot Company agreed to sell the assets of its Footwear Division to Albanese Incorporated for $80 million. The sale was completed on December 31, 2024.
The following additional facts pertain to the transaction:
The Footwear Division qualifies as a component of the entity according to GAAP regarding discontinued operations.
The book value of Footwear's assets totaled $48 million on the date of the sale.
Footwear's operating income was a pre-tax loss of $10 million in 2024.
Foxtrot's income tax rate is 25%.
In the income statement for the year ended December 31, 2024, Foxtrot Company would report:
a.income and gains separately from losses.
b.income (loss) from its continuing and discontinued operations separately.
c.income (loss) on its continuing operation only.
d.income (loss) on its total operations for the year without separation.
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