The following condensed income statements of the Jackson Holding Company 2021 and 2020: presented for the two years ended December 31, are 2820 2821 Sales revenue $15,480,e0e $10,0e0,eee 6,280,e0e 3,800,eee 2,760,e0e 1,840, eee Cost of goods sold Gross profit Operating expenses Operating income Gain on sale of division 9,480,e00 6,000,e0e 3.360.000 2,640, eee 640,e0e 3,280, eee 1,840, eee 260,e0e Income tax expense 820,eee 2,460, eee s 780,e0e Net income On October 15, 2021, Jackson entered into a tentative agreement to sell the assets of one of its divisions. The division qualifies as a component of an entity as defined by GAAP. The division was sold on December 31, 2021, for $5,120,000. Book value of the division's assets was $4.480,000. The division's contribution to Jackson's operating income before-tax for each year was as follows: $420, eee $320, eee 2821 2828 Assume an income tax rate of 25%. Requlred: (In each case, net any galn or loss on sale of dlvision with annual Income or loss from the dlvision and show the tax effect on a separate llne.) 1. Prepare revised income statements according to generally accepted accounting principles, beginning with income from continuing operations before income taxes. Ignore EPS disclosures. 2. Assume that by December 31, 2021, the division had not yet been sold but was considered held for sale. The fair value of the division's assets on December 31 was $5.120,00o. Prepare revised income statements according to generally accepted accounting principles, beginning with income from continuing operations before income taxes. Ignore EPS disclosures. 3. Assume that by December 31, 2021, the division had not yet been sold but was considered held for sale. The fair value of the division's assets on December 31 was $3,940,000. Prepare revised income statements according to generally accepted accounting principles, beginning with income from continuing operations before income taxes. Ignore EPS disclosures. Required 1 Required 2 Required 3 Prepare revised income statements according to generally accepted accounting principles, beginning with income from continuing operations before income taxes. Ignore EPS disclosures. (Amounts to be deducted should be indicated with a minus sign.) JACKSON HOLDING COMPANY Comparative Income Statements (in part) For the Years Ended December 31 2021 2020 Income from continuing operations before income taxes Income from continuing operations C 0 Discontinued operations gain (loss): Income from discontinued operations C Net income S S Required 1 Required 2 Required 3 Assume that by December 31, 2021, the division had not yet been sold but was considered held for sale. The fair value of the division's assets on December 31 was $5,120,000. Prepare revised income statements according to generally accepted accounting principles, beginning with income from continuing operations before income taxes. Ignore EPs disclosures. (Amounts to be deducted should be indicated with a minus sign.) Show less JACKSON HOLDING COMPANY Comparative Income Statements (in part) For the Years Ended December 31 2021 2020 Income from continuing operations before income taxes Income from continuing operations Discontinued operations gain (loss) Income from discontinued operations C Net income S C S Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Assume that by December 31, 2021, the division had not yet been sold but was considered held for sale. The fair value of the division's assets on December 31 was $3,940,000. Prepare revised income statements according to generally accepted accounting principles, beginning with income from continuing operations before income taxes. Ignore EPS disclosures. (Amounts to be deducted should be indicated with a minus sign.) Show less A JACKSON HOLDING COMPANY Comparative Income Statements (in part) For the Years Ende d December 31 2021 2020 Income from continuing operations before income taxes Income from continuing operations Discontinued operations gain (loss) Income from discontinued operations C C Net income C Required 3> Required 2
