Clark Company’s accountant reported income from continuing operations before extraordinary item of $725,000 for the year...
Clark Company’s accountant reported income from continuing operations before extraordinary item of $725,000 for the year ended 2013. The company’s income tax rate is 30%. The accountant also identified the following transactions that occurred in 2013: Due to an incorrect entry, cost of goods sold was overstated by $100,000 in the year 2012. The company has one of their operating divisions up for sale. The division qualifies as a component of the entity according to GAAP. The fair value and book value of the assets is $1,500,00 and $1,250,000, respectively. In addition, there was a loss from operations of $400,000 for the year 2013. Unrealized losses on securities held for sale amounted to $120,000. What is the amount of comprehensive income that will be reported by Clark?
Homework Answers
Amount of comprehensive income to be reported by Clark will be calculated as follows:
Above figures have been calculated in the following manner:
Note:
Overstatement of cost of goods sold in the year 2012 will not affect 2013 income statement.
Any gain due to increase in the fair market value of assets held for sale will not affect the income statement.
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