Chance Company had two operating divisions, one manufacturing farm equipment and the other office supplies. Both divisions are considered separate components as defined by generally accepted accounting principles. The farm equipment component had been unprofitable, and on September $1,2024,$ the company adopted a plan to sell the assets of the division.

Consider the following:

The actual sale was completed on December $15,2024,$ at a price of $$695,000.$ The book value of the divisions assets was $$1,500,000,$ resulting in a before$-$tax loss of $550$,000$ on the sale.

The division incurred a before$-$tax operating loss from operations of $$120,000$ from the beginning of the year through December $15.$

Chances after$-$tax income from its continuing operations is $$550,000.$

The income tax rate is $25\%.$

Required:

Prepare an income statement beginning with income from continuing operations. Include appropriate EPS disclosures assuming that $100,000$ shares of common stock were outstanding throughout the year.

Answer rating: 100% (QA)

Here is the income statement for Chance Company including the appropriate EPS disclosures Chance Com... View the full answer