If a Company Has a Discontinued Operation Gain of $30,000

question 162

Multiple Choice

If a company has a discontinued operation gain of $30,000 and a 32% tax rate, what is the effect on net income?

• A) Increase of $30,000.
• B) Increase of $20,400.
• C) Increase of $9,600.
• D) No effect.

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Definitions:

Inert Element

An inert element refers to a chemical element that exhibits very low reactivity due to having a full outer electron shell, such as noble gases.

Valence Shell

The outermost shell of electrons in an atom, important in determining an element's chemical properties.

Chemically Bonded

A method of joining materials using a process involving chemical reactions to create a strong bond between surfaces.

Molecule

The smallest unit of a chemical substance that still retains its chemical properties, typically made up of two or more atoms bonded together.