Lupton Inc

question 154

Multiple Choice

Lupton Inc. disposes of an unprofitable segment of its business. The operation of the segment suffered a $160,000 loss in the year of disposal. The loss on disposal of the segment was $80,000. If the tax rate is 30%, and income before income taxes was $1,300,000,

• A) the income tax expense on the income before discontinued operations is $318,000.
• B) the income from continuing operations is $910,000.
• C) net income is $1,060,000.
• D) the losses from discontinued operations are reported net of income taxes at $240,000.

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Definitions:

Participative Management

An effort to involve employees in a company’s decision-making.

Decision Making

The process of making choices by identifying a decision, gathering information, and assessing alternative resolutions.

Authoritarian

A governing or leadership style characterized by absolute or blind obedience to authority, as opposed to individual freedom and related to centralization of power.

Collaboration

The action of working with someone to produce or create something, often involving shared goals or resources.