Lupton Inc

question 79

Multiple Choice

Lupton Inc.disposes of an unprofitable segment of its business.The operation of the segment suffered a $200,000 loss in the year of disposal.The loss on disposal of the segment was $100,000.If the tax rate is 30%, and income before income taxes was $1,600,000,

• A)the income tax expense on the income before discontinued operations is $390,000.
• B)the income from continuing operations is $1,120,000.
• C)net income is $1,300,000.
• D)the losses from discontinued operations are reported net of income taxes at $300,000.

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