Trayer Corporation has income from continuing operations of $276,400 for the yea

Question

Trayer Corporation has income from continuing operations of $276,400 for the year ended December 31, 2014 it also has the following items before considering income taxes and extraordinary loss of $71,200 a gain of $41,800 on the discontinuance of a division a correction of an era in last year‘s financial statement that resulted in $10,600 understatement of 2013 that income assume all items are subject to income tax at 33% tax rate Trayer Corporation has income from continuing operations of $276,400 for the year ended December 31, 2014 it also has the following items before considering income taxes and extraordinary loss of $71,200 a gain of $41,800 on the discontinuance of a division a correction of an era in last year‘s financial statement that resulted in $10,600 understatement of 2013 that income assume all items are subject to income tax at 33% tax rate Trayer Corporation has income from continuing operations of $276,400 for the year ended December 31, 2014 it also has the following items before considering income taxes and extraordinary loss of $71,200 a gain of $41,800 on the discontinuance of a division a correction of an era in last year‘s financial statement that resulted in $10,600 understatement of 2013 that income assume all items are subject to income tax at 33% tax rate

Explanation / Answer

Trayer corporation Partial Income statement for the year ended 31 dember2014 Titles amount Income from continuining operations 276400 $       2,76,400.00 Discontinued operations gain on discontinued division 41800 less : tax @ 33%*41800 13794 $           28,006.00 income before extraordinary item $       3,04,406.00 extraordinary item 71200 less: tax savings 33% of 71200 23496 $         -47,704.00 net income $       2,56,702.00 therefore the net income for the year ended december 31, 2014 is $256702

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