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In discontinued operations: revenue is $19,210,000, COGS is $7,150,000, Depreciation Expense is $9,360,000, Income Tax Expense/(Benefit) is $550,800. If the company plans to sell this division by the end of 2016, with an expected sell price of $1,400,000 and legal fees for the sale of $200,000. The net carrying value of the division is $1,109,200. How do I figure out the discontinued operations section of the 2015 income statement if the division is not sold in 2015?
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Question & Answer: In discontinued operations: revenue is $19,210,000, COGS is $7,150,000, Depreciation Expense is $9,36…..
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| Income from discontinued operation | ||
| Income/loss from operation of discontinued operation | ||
| Revenue | 19,210,000 | |
| less:COGS | -7,150,000 | |
| Depreciation expense | -9,360,000 | |
| Income tax expense | -550,800 | |
| Income from operation of discontinued operation | 2,149,200 | |
| Gain/(loss)from sale of division | ||
| Net sale value [1,400,000-200,000] | 1,200,000 | |
| less:net carrying value | -1,109,200 | |
| Gain from sale of division | 90,800 | |
| Total income from discontinued operation | 2,240,000 |
