Question

Trayer Corporation has income from continuing operations of $272,000 for the year ended December 31, 2020. It also has the following items (before considering income taxes). 1. 2. An unrealized loss of $82,000 on available-for-sale securities. Again of $31,000 on the discontinuance of a division (comprised of a $15,000 loss from operations and a $46,000 gain on disposal). Assume all items are subject to income taxes at a 15% tax rate. Prepare a statement of comprehensive income, beginning with income from continuing operations. (Enter loss using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) TRAYER CORPORATION Partial Statement of Comprehensive Income

Answer 1

SOLUTION:

Contnuing operations:
Income from continuing operations before tax	272,000
Less: Income tax expense (272,000 * 15%)	40,800
Income from continuing operations after tax (A)	231,200
Discontinued operations
Income (loss) from operations of discontinued component (including ,	31,000
gain on disposal of $46,000)
Less: Income tax expense (31,000 * 15%)	4,650
Income from discontinued operations (B)	26,350
Net income (A+B)	257,550
Less: Unrealized loss on available -for-sale securities net of income taxes	61,500
[82,000 - 82,000*25%)
Comprehensive income	196,050