On May 31, 2024, the Arlene Corporation adopted a plan to sell its cosmetics line of business, considered a component of the entity. The assets of the component were sold on October 13, 2024, for $1,120,000. The component generated operating income of $300,000 from January 1, 2024, through disposal. In its income statement for the year ended December 31, 2024, the company reported before-tax income from operations of a discontinued component of $620,000. What was the book value of the assets of the cosmetics component? Multiple Choice $800,000 $1,420,000 $300,000 All of these choices are incorrect.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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On May 31, 2024, the Arlene Corporation adopted a plan to sell its cosmetics line of business, considered a component of the entity. The assets of the component were sold on October 13, 2024, for $1,120,000. The component generated operating income of $300,000 from January 1, 2024, through disposal. In its income statement for the year ended December 31, 2024, the company reported before-tax income from operations of a discontinued component of $620,000. What was the book value of the assets of the cosmetics component?

Multiple Choice

$800,000

$1,420,000

$300,000

All of these choices are incorrect. 

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