Question

Canton Corporation reported the following items in its adjusted trial balance for the year ended December 31, 2021: Income from continuing operations before income taxes Gain on disposal of discontinued component Loss from operations of discontinued component $ 120,000 28,000 (60,000) 3.33 points Canton is subject to a 25% tax rate 8 00:58:22 Required: Prepare the December 31, 2021, income statement for Canton Corporation, starting with income from continuing operations before income taxes. (Amounts to be deducted should be indicated with a minus sign.) Skipped CANTON CORPORATION Partial Income Statement For the Year Ended December 31, 2021 Income from continuing operations Discontinued operations: Loss on discontinued operations Net income (loss)

Answer 1

CANTON CORPORATION
Partial Income Statement
For the Year Ended December 31, 2021
Income from continuing operations before income taxes		120,000
Income tax expense		-30,000
Income from continuing operations		90,000
Discontinued operations:
Loss from operation of discontinued component, net of tax ( 60,000-60,000 x 25%)	-45,000
Gain on disposal of discontinued component, net of tax ( 28,000-28,000 x 25%)	21,000
Loss on discontinued operations		-24,000
Net Income		$66,000

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