Elwood P. Dowd Company has two divisions, J and K. The operations and cash flows of these two divisions are clearly distinguishable. On July 1, 2012, the company decided to dispose of the assets and liabilities of Division K. It is probable that the disposal will be completed early next year. The revenues and expenses of Dowd Company for 2009 and for the preceding two years are as follows:

During the latter part of 2012, Dowd disposed of a portion of Division K and recognized a pretax loss of $8,000 on the disposal. The income tax rate for Dowd Company is 40%.
Prepare the comparative income statements for Dowd Company for the years 2010, 2011, and 2012.

Question

Elwood P. Dowd Company has two divisions, J and K. The operations and cash flows of these two divisions are clearly distinguishable. On July 1, 2012, the company decided to dispose of the assets and liabilities of Division K. It is probable that the disposal will be completed early next year. The revenues and expenses of Dowd Company for 2009 and for the preceding two years are as follows:
  
During the latter part of 2012, Dowd disposed of a portion of Division K and recognized a pretax loss of $8,000 on the disposal. The income tax rate for Dowd Company is 40%.
Prepare the comparative income statements for Dowd Company for the years 2010, 2011, and 2012.

Quizplus · Accepted Answer

The Answer of Elwood P. Dowd Company has two divisions, J and K. The operations and cash flows of these two divisions are clearly distinguishable. On July 1, 2012, the company decided to dispose of the assets and liabilities of Division K. It is probable that the disposal will be completed early next year. The revenues and expenses of Dowd Company for 2009 and for the preceding two years are as follows:
  
During the latter part of 2012, Dowd disposed of a portion of Division K and recognized a pretax loss of $8,000 on the disposal. The income tax rate for Dowd Company is 40%.
Prepare the comparative income statements for Dowd Company for the years 2010, 2011, and 2012.

Elwood P Dowd Company Has Two Divisions, J and K