Ask Question
16 January, 15:37

Major Co. reported 2016 income of $315,000 from continuing operations before income taxes and a before-tax loss on discontinued operations of $63,000. All income is subject to a 40% tax rate. In the 2016 income statement, Major Co. would show the following line-item amounts for income tax expense and net income:

+3
Answers (1)
  1. 16 January, 16:04
    0
    Answer: The income tax expense $100,800, net income $252,000

    Explanation:

    To calculate net income

    Income from continuing operation before income tax - income before tax-loss on discontinued operation

    = 315,000 - 63,000

    = 252,000

    To calculate line item amount for income tax expense, we use the formula

    Income tax expense = Taxable income * tax rate

    Taxable income = $252,000, Tax rate = 40% (40 : 100) = 0.4

    = 252,000 * 0.4

    = $100,800
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Major Co. reported 2016 income of $315,000 from continuing operations before income taxes and a before-tax loss on discontinued operations ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers