Dos Amugus Company Has Income from Continuing Operations of $621,000

question 239

Essay

Dos Amugus Company has income from continuing operations of $621,000 (after tax) for the year ended December 31, 2017. It also has the following items (before considering income taxes):
(1) An unrealized loss of $120,000 available-for-sale-securities.
(2) A gain of $60,000 on the discontinuance of a major component.
(3) A cumulative effect of a change in accounting principle that resulted in an increase in prior years' depreciation of $50,000.
Assume all items are subject to income taxes at a 30% tax rate.
Instructions
Prepare a statement of comprehensive income, beginning with income from continuing operations.

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Definitions:

Mark-up

The difference between the cost of a product or service and its selling price, expressed as a percentage of the cost.

Spoilage

Products or materials that have become unfit for sale or use, often leading to financial loss for a business.

Bruising

Physical damage that appears on the skin or body tissues as a result of blunt impact, characterized by discoloration and swelling.

Overhead

The ongoing administrative and operational costs of running a business that are not directly attributable to the production of goods or services.