The following condensed income statements of the Jackson Holding Company are presented for the two years ended December 31, 2018 and 2017 Sales $15,500,000 $10,100,000 Cost of goods sold9,450,000 6,250,000 6, 050,000 3, 850,000 3, 400, 000 2, 800, 000 2, 650, 000 1, 050,000 4.16 points Gross profit Operating expenses Operating income Gain on sale of division Sdpped 650,000 3, 300, 000 1,320, 000 $ 1,980,000 1,050,000 420,000 630,000 Print Income tax expense Net income On October 15, 2018, 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, 2018, for $5,150,000. Book value of the division's assets was $4,500,000. The division's contribution to Jackson's operating income before-tax for each year was as follows: 2018 $425,000 2017 $325,000 Assume an income tax rate of 40%. Required: (In each case, net any gain or loss on sale of division with annual income or loss from the division and show the tax effect on a separate line) 1. Prepare revised income statements according to generally accepted accounting principles, beginning with income from continuing 2. Assume that by December 31, 2018, the division had not vet been sold but was considered held for sale. The fair value of the K Prev 10 of 24 Next