Landon, Inc., has several operating divisions. In September 2011, the management of Landon decided on a formal plan to sell one of its divisions. This division is considered a separate component as defined by SFAS No. 144.
The sale was completed on December 10, 2011, at which time the division was sold for $900,000. The book value of the assets of the division was $1,000,000. The before-tax operating loss of the division for the period January 1, 2011 to the date of disposal was $130,000. The company's tax rate is 40%. The after-tax income from continuing operations for 2011 was $350,000.
Prepare a partial income statement for 2011 beginning with income from continuing operations. Ignore EPS disclosures.

Question

Quizplus · Accepted Answer

The Answer of Landon, Inc., has several operating divisions. In September 2011, the management of Landon decided on a formal plan to sell one of its divisions. This division is considered a separate component as defined by SFAS No. 144.
The sale was completed on December 10, 2011, at which time the division was sold for $900,000. The book value of the assets of the division was $1,000,000. The before-tax operating loss of the division for the period January 1, 2011 to the date of disposal was $130,000. The company's tax rate is 40%. The after-tax income from continuing operations for 2011 was $350,000.
Prepare a partial income statement for 2011 beginning with income from continuing operations. Ignore EPS disclosures.