Answer:
Our Net income is $14,175,000.
Explanation:
It is given that the sale value of assets is $9.600,000 and book value of assets is $7.300,000. Thus, gain on sale of assets is $2.300,000. Total gain before tax is the total of gain on sale of assets of $2.300,000 and gain from operations of $4.300,000. Hence, the total gain before tax is $6.600,000.
PARTICULARS AMOUNT
Gain on sale of assets($9.600,000-$7.300,000) $2.300,000
ADD:Gain from operation $4.300,000
Total gain before tax $6.600,000
Therefore the total gain is $6.600,000.
STEP 2
R INDUSTRIES
PARTIAL INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31 2021
Income from continuous operation before income tax $12,300,000
Income tax expense($12.300,000×25%) -$3,075,000
Income from continuous operations $9,225,000
Discontinued operations
Gain from operations of discontinued component $6,600,000
Income tax expense($6.600,000×25%) -$1,650,000
Gain on discontinued operations $4,950,000
<u>Net income $14,175,000</u>
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<u>Therefore the net income is $14,175,000</u>
<u></u>
Explanation:
Income from continuing operations before income taxes is $12,300,000 and income tax expense is 25% of the income from continuing operations before income taxes. Therefore, the income from continuing operations is $9,225,000. Calculated gain from operations of discontinued component is $6,600,000 and income tax expense is 25% of the gain from operations of discontinued component. Therefore, the gain on discontinued operations is $4,950,000. Therefore, the net income is the total of income from continuing operations and gain on discontinued operations. Hence, the net income is $14,175,000.
