Question: On November 1 , 2 0 1 4 , management of Carley Corporation committed to a plan to dispose of PFG Company, a major subsidiary.

On November 1,2014, management of Carley Corporation committed to a plan to dispose of PFG Company, a major subsidiary. The disposal meets the requirements for classification as discontinued operations. The book value of PFG Company was $6,500,000 and management estimated the fair value less costs to sell to be $8,000,000. For 2014, PFG Company had a loss of $2,000,000. How much should Carley Corporation present as loss from discontinued operations before the effect of taxes in its income statement for 2014:
A. $2,000,000.
B. $3,500,000.
C. $500,000.
D. $1,500,000.

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