This paper circulates around the core theme of Determine the net income/(loss) on operations from the discontinued component as of December 31, 2010 together with its essential aspects. It has been reviewed and purchased by the majority of students thus, this paper is rated 4.8 out of 5 points by the students. In addition to this, the price of this paper commences from £ 99. To get this paper written from the scratch, order this assignment now. 100% confidential, 100% plagiarism-free.
TWO ACCOUNTING QUESTION! PLEASE HELP! URGENT! (FILE ATTACHED) Additional Requirements Level of… 1 answer below » TWO ACCOUNTING QUESTION! PLEASE HELP! URGENT! (FILE ATTACHED) Additional Requirements Level of Detail: Show all work Other Requirements: Please Help me Tutors! Willing to pay tips when I got answers Thank you Document Preview: On March 1, 2010, ABC Inc. sold a component of their business to XYZ Inc. for $700,000. ABC determined the component would be discontinued in 2009 and properly reported the component in the discontinued operations section of the income statement. At 12/31/2009, View complete question » TWO ACCOUNTING QUESTION! PLEASE HELP! URGENT! (FILE ATTACHED) Additional Requirements Level of Detail: Show all work Other Requirements: Please Help me Tutors! Willing to pay tips when I got answers Thank you Document Preview: On March 1, 2010, ABC Inc. sold a component of their business to XYZ Inc. for $700,000. ABC determined the component would be discontinued in 2009 and properly reported the component in the discontinued operations section of the income statement. At 12/31/2009, ABC estimated the fair value less cost to sell of the component to be $725,000, while the book value was $775,000.
During 2010, ABC had a pre-tax operating loss of $60,000 for the component. ABC is subject to a 30% income tax rate. Use () to show a loss.
1) Determine the net income/(loss) on operations from the discontinued component as of December 31, 2010: $
2) Determine the net gain/loss on disposal from the discontinued component as of December 31, 2010: $
ABC Inc. began operations on January 1, 2006. During its first 3 years of operations, ABC reported net income and declared dividends as follows.
Net Income Dividends
2006 $ 50,000 $ 0
2007 75,000 10,000
2008 125,000 0
2009 150,000 50,000
The following information relates to 2010.
• Net income was originally calculated as $200,000 and no dividends were declared during the period.
• Assume ABC is charged a tax rate of 30%.
• Additionally, ABC discovered in 2010 that they understated depreciation expense in 2008 by $25,000 and understated 2009 depreciation expense by $20,000.
• At the end of 2010, after the net income above was determined ABC decided to change from FIFO to LIFO. The following COGS information was determined under each method. The net income number given above was calculated for 2010 using FIFO.
FIFO COGS LIFO COGS
2006 $135,000 $120,000
2007 $115,000 $130,000
2008 $140,000 $110,000
2009 $150,000 $100,000
2010 $145,000 $115,000
ABC reported two years on the face of the income… Attachments: Q.docx Q-Attachment…..docx View less » Jul 28 2015 01:07 PM
