Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31): Sales Cost of goods sold Administrative expenses Selling expenses Interest revenue Interest expense Loss on sale of assets of discontinued component 2018 2017 $4,700,000 $3,800,000 2,920,000 2,060,000 860,000 735,000 420,000 372,000 156,000 146,000 212,000 212,000 74,000 On July 1, 2018, the company adopted a plan to discontinue a division that qualifies as a component of an entity as defined by GAAP. The assets of the component were sold on September 30, 2018, for $74,000 less than their book value. Results of operations for the component (included in the above account balances) were as follows: Sales Cost of goods sold Administrative expenses Selling expenses Operating income before taxes 1/1/18-9/30/18 $ 460,000 (320,000) (56,000) (26,000) $ 58,000 2017 $ 560,000 (356,000) (46,000) (36,000) $ 122,000 In addition to the account balances above, several events occurred during 2018 that have not yet been reflected in the above accounts: 1. A fire caused $56,000 in uninsured damages to the main office building. The fire was considered to be an infrequent but not unusual event. 2. Inventory that had cost $46,000 had become obsolete because a competitor introduced a better ......product. The inventory was sold as scrap for $6.000. REED COMPANY Comparative Income Statements For the Years Ended December 31 2018 2017 0 Sales revenue Cost of goods sold Gross profit (loss) Operating expenses: Administrative Selling Loss from fire damage Loss from write-down of obsolete inventory Total operating expenses Operating income Other income (expense): Interest revenue Interest expense Total other expenses (net) Income from continuing operations before income taxes Income tax expense Income from continuing operations Discontinued operations: Income (loss) from operations of discontinued component Income tax benefit (expense) Income (loss) on discontinued operations Net income Earnings per share: Income from continuing operations Discontinued operations Net income 0 1 0 0 $ $