Question

Cheyenne Corp. has income from continuing operations of $403,000 for the year ended December 31, 2020. It also has the following items (before considering income taxes). 1. An unrealized loss of $83,000 on available-for-sale securities. 2. A gain of $31,800 on the discontinuance of a division (comprised of a $8,800 loss from operations and a $40,600 gain on disposal). Assume all items are subject to income taxes at a 17% tax rate. Prepare a statement of comprehensive income, beginning with income from continuing operations.

Answer 1

Answer:

$360,904

Explanation:

Cheyenne Corp

Partial Statement of Comprehensive Income For the Year Ended December 31, 2020

Income from continuing operations $403,000

Discontinued operationsGain on discontinued segment, net of $5,406income taxes $26,394

($31,800×17%=$5,406)

($31,800-$5,406 =$26,394)

Net income $429,394

($403,000+$26,394)

Other comprehensive incomeUnrealized holding loss, on available-for-sale securities, net of $14,110 income tax savings $68,890

($83,000×17%=$14,110)

($83,000-$14,110=$68,890)

Comprehensive income $360,504

($429,394-$68,890)