Answer:
Esquire Comic Book Company
Income Statement
For the Year Ended December 31, 2021
Operating income $1,550,000
Restructuring costs ($60,000)
Income from continuing operations b/ Taxes $1,490,000
<u>Income tax expense ($372,500)</u>
Income from continuing operations $1,117,500
Discontinued operations:
- Operating income $610,000
- Loss on disposal ($395,000)
- <u>Income tax on discontinued operations ($53,750)</u>
Income from discontinued operations $161,250
<u>Net income $1,278,750</u>
Explanation:
Income from discontinued operations must be reported separately, but any restructuring costs must be included as operational expenses.
