answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
ANEK [815]
2 years ago
9

The company decided to discontinue an operating division during 2018 and sold the assets on December 15, 2018. Loss from operati

ons of the division were $500,000 for the year through 12/15/2018. The assets were sold for $800,000 and had a net book value of $1,000,000. The effective income tax rate if 40%. Income from continuing operations after taxes was $2,000,000. Calculate net income and prepare the income statement starting with income from continuing operations.
Business
1 answer:
BaLLatris [955]2 years ago
5 0

Answer: Please refer to the explanation section

Explanation:

Loss from operations = $500 000

Loss (sale of assets) = $1000 000 - $800 000 = $200 000

Income from continuing operations after tax = $2000 000, Therefore income from continuing operations before tax is equal to $200 000 x 100/60 = 3 333 333.333

Net Income before tax = 3 333 333.333  -  500 000 - 200 000

Net Income before tax == 2633 333.333

Net Income After Tax = 2633 333.333 x 60/100 = $1580 000

Income Statement

Income from continuing operations   3 333 333.333

Loss from operations                         - 500 000

Loss from sale of assets                    <u>- 200 000</u>

Net Income before Tax                       2633 333.333

Taxation                                              <u>-1053 333.333</u>

Net Income                                         1580 000

You might be interested in
Improving business processes by reengineering them, benchmarking specific activities against industry leaders, encouraging emplo
V125BC [204]

Answer: (C) Piecemeal productivity improvements

Explanation:

The piecemeal productivity improvement is one of the type of business strategy that is used by various types of successful organization for the purpose of improving the productivity of an employees, the business process and also managing all bench-marking activities in an organization.

 According to the given question, the given  activities in an organization are the example of Piecemeal productivity improvements that helps in expanding the product scope in the market. Therefore, Option (C) is correct answer.  

  Therefore, Option (C) is correct answer.

4 0
2 years ago
Silver Corporation has provided the following information concerning its raw materials purchases. The budgeted cost of raw mater
kakasveta [241]

Answer:

$171,619.20

Explanation:

The computation of the budgeted accounts payable balance at the end of November is shown below:

= Budgeted cost of raw materials purchases in November × following month percentage

= $286,032 × 60%

= $171,619.20

As 40% is paid in the month of purchase whereas 60% is paid to the following month. So, we recognized 60%, not 40%

4 0
2 years ago
Use the information presented in Midwestern Mutual Bank's balance sheet to answer the following questions. Bank’s Balance SheetA
shtirl [24]

Answer:

Midwestern Mutual Bank's Balance Sheet

Equity:

Owners' Equity - $100

Liabilities:

Deposits $1,200

Debts $200

Total - $1,400

Equity and Liabilities = $1,500

Assets:

Reserves - $150

Loans $600

Securities $750

Total Assets - $1,500

a) If a new customer adds $100 to his account, this would increase the loans account with $100 and the deposits account with $100.

b) The leverage ratio is the measure of the bank's core capital to total assets.

Old leverage ratio = 100 / 1500 x 100% = 6.67%

The new leverage ratio is 100 / 1600 x 100% = 6.25%.

c) The intended goal of capital requirement is protect the interests of those who hold equity in the bank.

Explanation:

Banks are highly leveraged.  This means that they usually maintain high leverage ratios.  The liabilities are always much compared to the capital.

Leverage ratio is the ratio of a bank's core capital (shareholders equity) to its total assets.

This is why the Federal Reserve introduces capital requirements for banks.  This tries to protect shareholders' equity that is usually written down when leverage ratios increase.  This is because the capital portion of assets to which the debts are tied can be written down, but the debts cannot.

7 0
2 years ago
Alex is a law attorney at Cooper Enterprises. His client, Maggie, is seeking a divorce from her husband of two years. Since she
inessss [21]

Answer: C.) jargon

Explanation: Based on differing fields, profession or line of expertise, some words or terms are usually reserved to connote a special relevance or usage within such field. In many cases, these words are usually popular only within the circle of such profession and usage is usually rampant within professionals or individuals in such field. Such terms which are usually specific to a profession or field and may be difficult for those outside the profession to understand are called JARGON. In the context above, Alimony is usually used within the legal setting to mean a husband's provision package to his spouse after separation.

4 0
2 years ago
A company purchased a tract of land for its natural resources at a cost of $1,500,000. It expects to mine 2,000,000 tons of ore
Natasha2012 [34]

Answer:

Option c is the correct answer.

Explanation:

The depletion expense or charge for the period can be calculated using the following formula,

Depletion expense = [(Cost - Salvage Value) / Total units expected to be mined] * Units mined during the period

Depletion expense = [(1500000 - 250000) / 2000000] * 150000

Depletion expense = $93750

The entry to record the expense is,

Depletion expense            93750 Dr

     Accumulated depletion         93750 Cr

So, option c is the correct answer.

7 0
2 years ago
Other questions:
  • Joseph purchased 100 shares of abcd growth fund for $10.00 per share for a total investment of $1,000. at the end of one year, h
    8·1 answer
  • Sasha's new company has told her that she will be required to move at her own expense in two years. What should she consider bef
    15·2 answers
  • When the effective interest rate method of amortization is used, the amount of interest expense for a given period is calculated
    15·1 answer
  • Ryan's dad needs to drive bigger company vehicles in order to get promoted. What does he need?
    6·1 answer
  • Name the three general methods of title assurance and briefly describe each. Which would you recommend to a friend purchasing a
    14·1 answer
  • With double-digit annual percentage increases in the cost of health insurance, more and more workers are likely to lack health i
    9·1 answer
  • Nuthatch Corporation began its operations on September 1 of the current year. Budgeted sales for the first three months of busin
    11·1 answer
  • Ivanhoe Company had these transactions during the current period. June 12 Issued 86,500 shares of $1 par value common stock for
    11·1 answer
  • Franklin Corporation issues $88,000, 10%, five-year bonds on January 1 for $92,000. Interest is paid semiannually on January 1 a
    8·1 answer
  • Ted, a project manager, wants to invest in a project with an initial cost of $58,500 and cash flows of $32,400 and $38,500 in Ye
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!