I need help in how to find the Extraordinary Loss, please can youn tell me how t
ID: 2452523 • Letter: I
Question
I need help in how to find the Extraordinary Loss, please can youn tell me how to do this. I have some done, and how to do Earnings per Common Share.
Pallest Corporation reported the following pretax information for its current fiscal year: $40,000 income from continuing operations and an $8,000 extraordinary loss. Pallest is subject to a 30% income tax rate and had 8,000 shares of common stock outstanding for the year.
Starting with pretax income from continuing operations, prepare a partial income statement for Pallest Corporation for the current year. Be sure to include earnings per share information. Round earnings per share computations to two decimal places.
PALLEST CORPORATION
Income Statement (Partial)
For Year Ended December 31, Current Year
Pretax income from continuing operations
$ 40,000
Income tax expense
12,000
Income from continuing operations
$ 28,000
Extraordinary loss (net of taxes)
Net Income
$
Components of Income
Earnings per Common Share
Income from continuing operations
$
Extraordinary loss
Net income
$
Starting with pretax income from continuing operations, prepare a partial income statement for Pallest Corporation for the current year. Be sure to include earnings per share information. Round earnings per share computations to two decimal places.
PALLEST CORPORATION
Income Statement (Partial)
For Year Ended December 31, Current Year
Pretax income from continuing operations
$ 40,000
Income tax expense
12,000
Income from continuing operations
$ 28,000
Extraordinary loss (net of taxes)
Net Income
$
Components of Income
Earnings per Common Share
Income from continuing operations
$
Extraordinary loss
Net income
$
Explanation / Answer
Income statement Particulars Amount Remarks Pretax income from continuing operatoins $40,000.00 Income tax expense $12,000.00 Income from continuing operations $28,000.00 Minus:Extra ordinary loss net of tax $5,600.00 Tax savings on loss =8000*30%. Loss net of tax savings =($8000 -8000*30%) Net income $22,400.00 Components of income Earnings per share Income from continuing operations $28,000.00 $3.50 Extra ordinary loss -$5,600.00 -$0.70 Net income $22,400.00 $2.80
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