Question

During 2019, Lopez Corporation disposed of Pine Division, a major component of its business. Lopez realized a gain of $2,400,000, net of taxes, on the sale of Pine's assets. Pine's operating losses, net of taxes, were $2,800,000 in 2019. What is the gain or loss from discontinued operations reported net of taxes

Answer 1

Answer:

Continued operation = 0

Discontinued operation = $400,000

Explanation:

Lopez corporation realized a gain of $2,400,000

Pine operating losses were $2,800,000

Therefore the loss or gain from discontinued operation can be calculated as follows

= $2,400,000-$2,800,000

= -$400,000

= $400,000 loss

Hence continued operation is 0 and discontinued operation is $400,000