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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?


Definitions:

Average Tax Rates

It reflects the fraction of total income that is paid in taxes, calculated by dividing the total amount of taxes paid by the total income.

Book Value

Book value is the value of an asset according to its balance sheet account balance, taking into account the cost of the asset minus depreciation.

Net Income

The net income of a business once all costs and taxes are deducted from the total earnings.

Operating Cash Flow

The cash generated from a company's normal business operations, indicating whether a company can generate sufficient positive cash flow to maintain and grow its operations.

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