Dandy Candy Company sold its licorice division resulting in a loss of $60,000. Assuming a tax rate of 25%, the loss on this disposal will be reported on the income statement at what amount? A) S75,000 B) $15,000 C) $60,000 D) $45,000
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- The Bookbinder Company had 500,000 cumulative operating losses prior to the beginning of last year. It had 100,000 in pre-tax earnings last year before using the past operating losses and has 300,000 in the current year before using any past operating losses. It projects 350,000 pre-tax earnings next year. a. How much taxable income was there last year? How much, if any, cumulative losses remained at the end of the last year? b. What is the taxable income in the current year? How much, if any, cumulative losses remain at the end of the current year? c. What is the projected taxable income for next year? How much, if any, cumulative losses are projected to remain at the end of next year?JoeBlow Co. had revenue and expenses from ongoing business operations for the current year of $1,000,000 and $700,000, respectively. During the year the company sold a money losing division that had revenues and expenses of $100,000 and $200,000, respectively (these amounts are NOT included in the regular ongoing business revenues and expenses shown above). The division was sold at a small profit of $30,000. Assume all items are subject to a tax rate of 30%. Prepare an income statement for JoeBlow Co. for the current year.The following information is related to Dickinson Company for 2020. Retained earnings balance, January 1, 2020 $ 980,000 Sales revenue 25,000,000 Cost of goods sold 16,000,000 Interest revenue 70,000 Selling and administrative expenses 4,700,000 Write-off of goodwill 820,000 Income taxes for 2020 1,244,000 Gain on the sale of investments 110,000 Loss due to flood damage 390,000 Loss on the disposition of the wholesale division (net of tax) 440,000 Loss on operations of the wholesale division (net of tax) 90,000 Dividends declared on common stock 250,000 Dividends declared on preferred stock 80,000 Dickinson Company decided to discontinue its entire wholesale operations (considered a discontinued operation) and to retain its manufacturing operations. On September 15, Dickinson sold the wholesale operations to Rogers Company. During 2020, there were 500,000 shares of common stock outstanding all year. Instructions Prepare a multiple-step income statement…
- 6. BB Company had a net income after tax of P3,500,000 for the year ended December 31, 2021 after giving effect to the following events which occurred during the year. The decision was made on May 31 to discontinue the bottles manufacturing segment. The bottle manufacturing segment was sold on June 30. Operating profit from January 1 to May 30 for the bottle manufacturing segment amounted to P950,000 before tax benefit. Bottle manufacturing equipment with a book value of P1,900,000 was sold for P1,150,000. The tax rate was 30%. For the year ended December 31, 2021, how much was the company’s after tax income from continuing operations?Arreaga Corp. has a tax rate of 40 percent and income before non-operating items of €262,000. It also has the following items (gross amounts). Unusual loss € 37,000 Discontinued operations loss 101,000 Gain on disposal of equipment 8,000 Change in accounting principle increasing prior year's income 53,000 What is the amount of income tax expense Arreaga would report on its income statement? a. €104,800 b. €93,200 c. €111,200 d. €74,000Toodles Inc. had sales of $1,840,000. Cost of goods sold, administrative and selling expenses, and depreciation expenses were $1,180,000, $185,000 and $365,000 respectively. In addition, the company had an interest expense of $280,000 and a tax rate of 35 percent. (Ignore any tax loss carryback or carry forward provisions.) What was Toodles’s OCF?
- The following information is provided about PT Caltex: - Revenue from operations IDR 430,000,000 - Loss on the decrease in inventory Rp.12,000,000 - Sales Expense IDR 62,000,000 - Interest expense of IDR 20,000,000 - The tax rate is 30% Then the profit of PT Caltex is.... a. IDR 287,000,000 b. IDR 410,000,000 c. IDR 430,000,000 d. IDR 250,000,000 Do not give answer in imageSoutheast Airlines had pretax earnings of $65 million, including a gain on disposal of a discontinued operation of $10 million. The company’s tax rate is 40%. What is the amount of income tax expense that Southeast should report in its income statement? How should the gain on disposal of a discontinued operation be reported?Mainline Clinic, a for-profit business, had revenues of $11.1 million last year. Expenses other than depreciation totaled 67 percent of revenues, and depreciation expense was $1.3 million. All revenues were collected in cash during the year, and all expenses other than depreciation were paid in cash. Mainline must pay taxes at a rate of 39 percent of pretax (operating) income. Now, suppose the company changed its depreciation calculation procedures (still within GAAP) such that its depreciation expense doubled. How would this change affect Mainline’s net income? If net income would go down, enter the amount of the change as a negative number. If net income would go up, enter the amount of the change as a positive number.
- Southeast Airlines had pretax earnings of $65 million. Included in this amount is income from discontinued operations of $10 million. The company’s tax rate is 25%. What is the amount of income tax expense that Southeast would report in its income statement for continuing operations? How should the gain on disposal of a discontinued operation be reported?Gordon Brown Co’s Profit before tax was Rs7 million and a statement of financial position total of Rs23 million.Gordon Brown owns a number of its retail premises, which it revalues annually. This year several of its shops rose sharply in value due to inflated property prices in their locality. Gordon Brown does not revalue its factory premises, which are held in the statement of financial position at Rs 2.7 million. Prepare an unmodified opinion with BASIS OF OPINION, EMPHASIS OF MATTER and KEY AUDIT MATTER PARAGRAPH to give your view on this situation.Outlook Corporation sells gas stoves. Its sales had a total of P250,000 during its first year of operation. All its sales were installment sales and it managed to collect only P80,000 in the said year.Outlook repossessed one gas stove after a customer defaulted in payment. The balance of the receivable pertaining to the repossessed stove was P25,000 at the time of repossession. How much is the deferred gross profit at year end if the gross margin ratio is 25%?a. P145,000 c. P170,000b. P36,250 d. P42,500