Question

Fox, Inc. provided the following partial-trial balance (selected accounts) for the year ended December 31, 2018. During 2018, Fox sold Division A, not Division B. Fox is subject to a 30% income tax rate.

Accounts Debit Credit

Sales 325,500

Income from Discontinued Operations-Div. A 3,830

Interest Income 1,450

Gain on Disposal of Plant Assets-Div. B 14,500

Unrealized Gain on Available-for-sale

Marketable Securities 12,000

Cost of Goods Sold 130,600

Office Supplies Expense 4,500

Sales Salaries Expense 8,390

Selling Expenses 11,210

Accounting Fees—General Expense 2,400

Advertising Expense 6,660

Office Salaries Expense 21,480

Depreciation Expense 18,600

Interest Expense 2,570

Loss on Asset Impairment 1,840

Dividends 10,500

What amount will appear in Fox's 2018 income statement immediately above the net income amount?

Group of answer choicest

$3,830

$1,149

$4,979

$2,681

Answer 1

Amount that will appear in Fox's 2018 income statement immediately above the net income amount:-

Answer:- $2,681

Computation:-

Income from Discontinued Operations:

Income from Discontinued Operations-Div. A $3,830

Less Income Tax @30% (1,149)

Net Effect of Income from Discontinued Operations $2,681

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