Question
On September 1, 2015, Rock Inc. approved a plan to dispose of a segment of its business. Rock expected that the sale would occur on
On September 1, 2015, Rock Inc. approved a plan to dispose of a segment of its business. Rock expected that the sale would occur on March 31, 2016, at an estimated gain of $350,000. The segment had actual and estimated operating profits (losses as follows): Realized loss from 1/1/15 to 8/31/15 $(300,000) Realized loss from 9/1/15 to 12/31/15 (200,000) Expected profit from 1/1/16 to 3/31/16 400,000 Assume a marginal tax rate of 25%. In its 2015 income statement, what should Rock report as profit or loss from discontinued operations (net of tax effects)?
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