Taxes EyeBeam Corporation reports the following pretax accounting (and taxable) income items during 2016: Income from continuing operations $ 90,000* Loss from operations of a discontinued division (10,000) Gain from the disposal of the discontinued division 25,000 * Of this amount, revenues are $ 320,000 and expenses are $ 230,000.
Required:
1. Prepare the journal entry necessary to record the 2016 intraperiod income tax allocation in regard to the preceding information. Assume a tax rate of 15% on the first $ 40,000 of income and a rate of 30% on income in excess of $ 40,000.
2. Prepare EyeBeam’s 2016 income statement.