e following information is taken from the draft financial statement of Star Inc. at their March 31, 2015 year end. Income from continuing operations before taxes is $5,380,000. • The average tax rate for the company is 35%. • There are 250,000 common shares outstanding. • Star Inc. follows IFRS. Iditional transactions which are not included in the above figures are as follows: 1. Disposal of a division generated a $250,000 loss before tax. 2. An underestimation of depreciation from 2013 totalling $3,500 was found and charged to retained earnings. This was due to a calcu 3. Obsolete inventory was written off for $436,000. 4. A prior period lawsuit, which had been deemed unlikely and unestimable, was settled and the company received $303,000. 5. Machinery costing $610,000, with a book value of $237,000 was sold for $306,000. 6. The fair value of Āvailable for Sale (AFS) investments increased by a pre-tax amount of $15,000. ease make sure your final answers are accurate to the nearest whole number unless otherwise stated. Calculate income before tax and discontinued operations. mcome = $

e following information is taken from the draft financial statement of Star Inc. at their March 31, 2015 year end. Income from continuing operations before taxes is $5,380,000. • The average tax rate for the company is 35%. • There are 250,000 common shares outstanding. • Star Inc. follows IFRS. Iditional transactions which are not included in the above figures are as follows: 1. Disposal of a division generated a $250,000 loss before tax. 2. An underestimation of depreciation from 2013 totalling $3,500 was found and charged to retained earnings. This was due to a calcu 3. Obsolete inventory was written off for $436,000. 4. A prior period lawsuit, which had been deemed unlikely and unestimable, was settled and the company received $303,000. 5. Machinery costing $610,000, with a book value of $237,000 was sold for $306,000. 6. The fair value of Āvailable for Sale (AFS) investments increased by a pre-tax amount of $15,000. ease make sure your final answers are accurate to the nearest whole number unless otherwise stated. Calculate income before tax and discontinued operations. mcome = $

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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