Eaton, Inc

question 37

Multiple Choice

Eaton, Inc.disposes of an unprofitable segment of its business.The operation of the segment suffered a $360,000 loss in the year of disposal.The loss on disposal of the segment was $180,000.If the tax rate is 30%, and income before income taxes was $2,250,000,

• A)the income tax expense on the income before discontinued operations is $513,000.
• B)the income from continuing operations is $1,575,000.
• C)net income is $1,710,000.
• D)the losses from discontinued operations are reported net of income taxes at $270,000.

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Definitions:

Fundamental Attribution Error

A cognitive bias where people overemphasize personal traits and underestimate situational factors when explaining others' behaviors.

Self-Serving Bias

A common cognitive bias that causes individuals to attribute their successes to internal factors and their failures to external factors.

Self-Fulfilling Prophecy

A belief or expectation that influences behaviors in a way that causes the belief to become a reality.

Projection

A defense mechanism where an individual ascribes their own unacceptable thoughts, feelings, or motives to another person.