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:

Financial Decisions

Decisions made by individuals or organizations related to the allocation of resources, investment, budgeting, and managing finances.

Operating Policy

A set of guidelines or principles that dictate the operational decisions and day-to-day functioning of an organization.

Directors

Individuals elected by shareholders to oversee the management of a company, making strategic and operational decisions to ensure the company's success.

Related Party Transaction

A deal or arrangement between two parties who are joined by a special relationship prior to the deal.