Question: Munnster Corporation s income statements for the years ended December 31

Munnster Corporation’s income statements for the years ended December 31, 2014, and 2013 included the following information before adjustments:

On January 1, 2014, Munnster Corporation agreed to sell the assets and product line of one of its operating divisions for $2,000,000. The sale was consummated on December 31, 2014, and it resulted in a gain on disposition of $350,000. This division’s pre-tax net losses were $505,000 in 2014 and $170,000 in 2013. The income tax rate for both years was 30%.

Starting with operating income (before tax), prepare revised comparative income statements for 2014 and 2013 showing appropriate details for gain (loss) from discontinuedoperations.

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  • CreatedSeptember 10, 2014
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