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 South-east would report in its income statement for continuing operations? How should the gain on disposal of a dis-continued operation be reported?

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
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Chapter6: Accounting For Financial Management
Section: Chapter Questions
Problem 4P: Talbot Enterprises recently reported an EBITDA of $8 million and net income of $2.4 million. It had...
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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 South-east would report in its income statement for continuing operations? How should the gain on disposal of a dis-continued operation be reported?

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