Seven Line Corporation manufactures sports gear and merchandise. Presented below is information related to Seven Line Corporation for the current fiscal year. All amounts arepre-tax. The tax rate is30%. Use the information below to prepare multi-step income statement and answer the followingmultiple-choice questions.

Sales Revenue

$1,550,000

Unearned Revenue

20,000

Sales Returns

50,000

Selling and Administrative Expense

240,000

Loss from Hurricane Joaquin

290,000

Cost of Goods Sold

880,000

Restructuring Charges

20,000

Gain on Sale of Plant Assets

10,000

Income from Sneaker Division

50,000

Unrealized Gain on Available for Sale Securities

10,000

Accumulated Other Comprehensive Income

30,000

Other notes for the fiscalyear:

* Hurricane Joaquin was the first one hurricane to affect the company in 10 years.

* On the last date of the fiscalyear, Seven Line Corporation sold its Sneakers division to Grand Slam Corporation for a gain of$53,000 before tax.

What is net income for Seven LineCorporation?

A.

None of the above

B.

$149,100

C.

$128,100

D.

$135,100

How should Seven Line Corporation report the Sneakersdivision?

A.

None of the above.

B.

As a$53,000 pretaxgain/ income under"Other Gains/Losses"

C.

As a$72,100 gain/income, net of tax under"Discontinued Operations"

D.

As a$37,100 gain/income, net of tax under"Discontinued Operations"