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On September 1,2016,Jacob Furniture Mart enters into a tentative agreement to sell the assets of its office equipment division.This division qualifies as a component of the entity according to GAAP regarding discontinued operations.The division's contribution to Jacob's operating income for 2016 was a $3 million loss before taxes.Jacob has an average tax rate of 30%.
Required: Consider independently the appropriate accounting by Jacob under the three scenarios below.
-Scenario 1: Assume that Jacob sold the division's assets on December 31,2016,for $24 million.The book value of the division's assets was $19 million at that date.Under these assumptions,what would Jacob report in its 2016 income statement regarding the office equipment division? Explain where this information would be presented.

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On September 1,2016,Jacob Furniture Mart enters into a tentative agreement to sell the assets of its office equipment division.This division qualifies as a component of the entity according to GAAP regarding discontinued operations.The division's contribution to Jacob's operating income for 2016 was a $3 million loss before taxes.Jacob has an average tax rate of 30%.
Required: Consider independently the appropriate accounting by Jacob under the three scenarios below.
-Scenario 1: Assume that Jacob sold the division's assets on December 31,2016,for $24 million.The book value of the division's assets was $19 million at that date.Under these assumptions,what would Jacob report in its 2016 income statement regarding the office equipment division? Explain where this information would be presented.

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On September 1,2016,Jacob Furniture Mart enters into a tentative agreement to sell the assets of its office equipment division.This division qualifies as a component of the entity according to GAAP regarding discontinued operations.The division's contribution to Jacob's operating income for 2016 was a $3 million loss before taxes.Jacob has an average tax rate of 30%.
Required: Consider independently the appropriate accounting by Jacob under the three scenarios below.
-Scenario 1: Assume that Jacob sold the division's assets on December 31,2016,for $24 million.The book value of the division's assets was $19 million at that date.Under these assumptions,what would Jacob report in its 2016 income statement regarding the office equipment division? Explain where this information would be presented.

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