Reporting Discontinued OperationsDisposal in Subsequent Year On October 1, 2020, Blain Company approved a formal plan to sell the McKay Division, considered a component of the business The sale will occur on March 31, 2021 The division had operating income of $500,000 (pretax) for the year ended December 31, 2020, but expects to incur an operating loss of $100,000 for the first quarter of 2021 Blain determines the carrying value and fair value (net of selling costs) of the McKay Division to be $5,000,000 and $4,800,000, respectively, on December 31, 2020 Blains tax rate for 2020 is 25 Weighted average number of common shares outstanding in 2020 is 300,000 Required a Assume Blain Companys income from continuing operations is $2,300,000 Prepare a partial income statement beginning with income from continuing operations Include earnings per share disclosures Use a negative sign to indicate a loss Enter the answers for per share amounts in dollars and cents, rounded to the nearest penny Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Discontinued operations Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Impairment loss on discontinued component, net of tax savings Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Per share Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Impairment loss on discontinued, component, net of tax savings Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income b How does the answer to part a change if the fair value of the McKay Divisions net assets were $5,200,000 instead of $4,800,000 on December 31, 2020 Use a negative sign to indicate a loss Enter the answers for per share amounts in dollars and cents, rounded to the nearest penny Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Discontinued operations Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Impairment loss on discontinued component, net of tax savings Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Per share Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income Impairment loss on discontinued, component, net of tax savings Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income

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Reporting Discontinued OperationsDisposal in Subsequent Year On October 1, 2020, Blain Company approved a formal plan to sell the McKay Division, considered a component of

Reporting Discontinued OperationsDisposal in Subsequent Year

On October 1, 2020, Blain Company approved a formal plan to sell the McKay Division, considered a component of the business. The sale will occur on March 31, 2021. The division had operating income of $500,000 (pretax) for the year ended December 31, 2020, but expects to incur an operating loss of $100,000 for the first quarter of 2021. Blain determines the carrying value and fair value (net of selling costs) of the McKay Division to be $5,000,000 and $4,800,000, respectively, on December 31, 2020. Blains tax rate for 2020 is 25%. Weighted average number of common shares outstanding in 2020 is 300,000.

Required

a. Assume Blain Companys income from continuing operations is $2,300,000. Prepare a partial income statement beginning with income from continuing operations. Include earnings per share disclosures.

Use a negative sign to indicate a loss.
Enter the answers for per share amounts in dollars and cents, rounded to the nearest penny.

Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Discontinued operations
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Impairment loss on discontinued component, net of tax savings
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Per share:
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Impairment loss on discontinued, component, net of tax savings
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income

b. How does the answer to part a change if the fair value of the McKay Divisions net assets were $5,200,000 instead of $4,800,000 on December 31, 2020?

Use a negative sign to indicate a loss.
Enter the answers for per share amounts in dollars and cents, rounded to the nearest penny.

Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Discontinued operations
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Impairment loss on discontinued component, net of tax savings
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Per share:
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income
Impairment loss on discontinued, component, net of tax savings
Gain on disposal of discontinued component, net of taxIncome before income taxesIncome from continuing operationsIncome from discontinued component, net of taxIncome tax expenseLoss from continuing operationsLoss from discontinued component, net of tax savingsLoss on disposal of discontinued component, net of tax savingsNet income