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Can someone help me with this question? The blank spaces are the ones that I can

ID: 2491899 • Letter: C

Question

Can someone help me with this question? The blank spaces are the ones that I can't figure out.

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Trayer Corporation has income from continuing operations of $257,000 for the year ended December 31, 2014. It also has the following items (before considering income taxes).

1.

An extraordinary loss of $80,500.

2.

A gain of $29,800 on the discontinuance of a division.

3.

A correction of an error in last year’s financial statements that resulted in a $15,700 understatement of 2013 net income.


Assume all items are subject to income taxes at a 33% tax rate.

(a)

Prepare an income statement, beginning with income from continuing operations.

[Partially correct answer.]

Your answer is partially correct. Try again.

Trayer Corporation has income from continuing operations of $257,000 for the year ended December 31, 2014. It also has the following items (before considering income taxes).

1.

An extraordinary loss of $80,500.

2.

A gain of $29,800 on the discontinuance of a division.

3.

A correction of an error in last year’s financial statements that resulted in a $15,700 understatement of 2013 net income.


Assume all items are subject to income taxes at a 33% tax rate.

(a)

Prepare an income statement, beginning with income from continuing operations.

TRAYER CORPORATION
Partial Income Statement
For the Year Ended December 31, 2014

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Income From Continuing Operations $257,000

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Discontinued Operations

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    Discontinued Operations
    Dividends
    Expenses
    Extraordinary Item
    Extraordinary Loss
    Gain on Discontinued Division
    Income Before Extraordinary Item
    Income Before Income Taxes
    Income From Continuing Operations
    Income Tax Expense
    Loss from Operations of Music Division
    Net Income / (Loss)
    Retained Earnings
    Total Expenses
    Total Revenues

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Income Before Extraordinary Item $

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Extraordinary Item

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    Extraordinary Loss $ (53,935)

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Net Income / (Loss) $

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Explanation / Answer

Ans)a Income statement Particular Amount Income from continuing Operation 257000 Extra ordinary items Less: Extra ordinary loss -80500 Add: Gain on discountinuance 29800 Add: correction in income 15700 Net income Before tax 222000 less: Tax 66600 Net income after Tax 155400

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