Answer:
Esquire Comic Book Company
Income Statement
For the Year Ended December 31, 2016
Operating income $1,000,000
<u>Restructuring costs ($80,000)</u>
Income from continuing operations b/ Taxes $920,000
<u>Income tax expense ($368,000)</u>
Income from continuing operations $552,000
Discontinued operations:
- Operating income $500,000
- Loss on disposal ($350,000)
- <u>Income tax on discontinued operations ($60,000)</u>
Income from discontinued operations $90,000
<u>Net income $642,000</u>
Explanation:
Income from discontinued operations must be reported separately, but any restructuring costs must be included as operational expenses.
