4p-3 - Name: Problem: Course: Date: P4-3, Irregular Items...

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Problem 4-3, Page 1 of 2, 02/24/2010, 07:30:23 Name: Problem: P4-3, Irregular Items Course: Date: Maher Inc. reported income from continuing operations before taxes during 2010 of $790,000 Additional transactions occurring in 2010 but not considered in the $790,000 are as follows: $90,000 during the year. The tax rate on this item is 46% $54,000 salvage value of $9,000 that had a useful life of 6 years. The bookkeeper used straight-line $57,000 (pretax). $150,000 from an insurance policy. The cash surrender value of the policy had been carried on the books as an investment in the amount of $46,000 (the gain is nontaxable). $115,000 before taxes. Assume that this transaction meets the criteria for discontinued operations. method. The effect of this change on prior years is to increase 2008 income by $60,000 and decrease 2009 income by $20,000 before taxes. The FIFO method has been used for 2010. The tax rate on these items is
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4p-3 - Name: Problem: Course: Date: P4-3, Irregular Items...

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