Week 3 Team C - 6.22 Extraordinary item net tax...

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Tony Rich Inc. Income Statement For year ended December 31, 2007 Income from continuing operations before income tax $798,500 income tax 220,350 Income from continuing operations 578,150 Discontinued operations loss from recreational division $115,000 minus income tax reduction (115,000 * .30) 34,500 80,500 Income before extraordinary item 497,650 Extraordinary item flood loss 80,000 minus income tax reduction (80,000 * .46) 36,800 43,200 Net Income 454,450 Earnings per share Income from continuing operations (578,150/80,000= 7.226875 $7.23 Discontinued operations net tax (80,500/80,000= 1.00625) -1.01 Income beore extraordinary items (497,650/80,000= 6.220625)
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Unformatted text preview: 6.22 Extraordinary item net tax (43,200/80,000= .54)-0.54 Net income (454,450/80,000= 5.680625) 5.68 Icome from continued operations before taxes income stated $790,000 loss: sales securities-57,000 gain: Life Insurance policy (110,000-46,000) 64,000 Miscalculation of depreciation Calculated as (54,000/6) 9,000 Corrected calculation (54,000- 9,000/6)-7,500 1,500 Restated $798,500 Taxes Income from continuing operations pretaxed $798,500 Gain on life insurance (nontaxable)-64,000 Taxable income 734,500 Tax Rate (30%) * .30 Income tax expense $220,350...
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This note was uploaded on 04/04/2012 for the course ACC 422 taught by Professor Susan during the Spring '08 term at University of Phoenix.

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