Howard Co.\'s 2016 income from continuing operations before income taxes was $28

Question

Howard Co.'s 2016 income from continuing operations before income taxes was $287,000. Howard Co. reported a before-tax income on discontinued operations of $66,000. All tax items are subject to a 36% tax rate. In its income statement for 2016, Howard Co. would show the following line-item amounts for net income and income tax expense:

  

$103,320 and $225,920.

$353,000 and $310,760.

$221,000 and $263,240.

$225,920 and $103,320.

Howard Co.'s 2016 income from continuing operations before income taxes was $287,000. Howard Co. reported a before-tax income on discontinued operations of $66,000. All tax items are subject to a 36% tax rate. In its income statement for 2016, Howard Co. would show the following line-item amounts for net income and income tax expense:

Explanation / Answer

$225,920 and $103,320 is correct answer.

Income from continuing operations before income taxes $287,000 Income tax expense ($287,000 x 36%) $103,320 Income from continuing operations $183,680 Income on discontinued operations (net of $23,760 tax) $42,240 Net income $225,920

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