Question
QUESTION 22 Henderson Corporation includes in its results for the year ended December 31, 2019 the following items: Gain on Sale of Investments $20,000 Cash
QUESTION 22
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Henderson Corporation includes in its results for the year ended December 31, 2019 the following items:
Gain on Sale of Investments
$20,000
Cash
1,600,000
Interest Expense
15,000
Cost of Goods Sold
4,500,000
Selling Expenses
500,000
Restructuring Costs
344,000
Accounts Payable
40,000
Sales
7,600,000
Administrative Expenses
96,000
Sales Returns
200,000
Additional Information:
1) Hendersons effective tax rate is 30%.
2) Henderson sells the assets of a particular division on December 15, 2019 at a price of $500,000. The net book value of the divisions assets at the time of sale is $800,000. The division has before-tax operating income from operations of $75,000 from the beginning of the year through December 15, 2019.
What is income from continuing operations before income tax?
A. $1,980,000.
B. $1,965,000.
C. $3,400,000.
D. $1,995,000
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