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2008 Acct 304 Ch 4 Homework Key

2008 Acct 304 Ch 4 Homework Key - Exercise 4-5 CHANCE...

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Exercise 4-5 CHANCE COMPANY Partial Income Statement For the Year Ended December 31, 2009 Income from continuing operations .................................... $ 350,000 Discontinued operations: Loss from operations of discontinued component (including loss on disposal of $400,000) * ............................... (530,000) Income tax benefit ............................................................ 212,000 Loss on discontinued operations ...................................... (318,000 ) Net income .......................................................................... $ 32,000 Earnings per share: Income from continuing operations .................................... $ 3.50 Loss from discontinued operations ..................................... (3 .18 ) Net income .......................................................................... $ .32 * Loss on discontinued operations: Loss on sale of assets $(400,000) Operating loss (130,000 ) Total before-tax loss (530,000) Less: Income tax benefit (40%) 212,000 Net-of-tax loss $(318,000 ) Exercise 4-7 Requirement 1 KANDON ENTERPRISES, INC. Partial Income Statement For the Year Ended December 31, 2009 Income from continuing operations .................................... $ 400,000
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Discontinued operations: Loss from operations of discontinued component (including impairment loss of $50,000) * .............................. (190,000) Income tax benefit ............................................................. 76,000 Loss on discontinued operations ....................................... (114,000 ) Net income .......................................................................... $ 286,000 * Loss on discontinued operations: Operating loss $(140,000) Impairment loss ($250,000 - 200,000) (50,000 ) Net before-tax loss (190,000) Income tax benefit (40%) 76,000 Net after-tax loss on discontinued operations $(114,000 ) Requirement 2 KANDON ENTERPRISES, INC. Partial Income Statement For the Year Ended December 31, 2009 Income from continuing operations .................................... $ 400,000 Discontinued operations: Loss from operations of discontinued component * ......... (140,000) Income tax benefit ............................................................ 56,000 Loss on discontinued operations ....................................... (84,000 ) Net income .......................................................................... $ 316,000 * Includes only the operating loss during the year.
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