Question 3 BluRay Inc: decided to sell DemandTV Ltd., a subsidiary, on September 30, 2021. There is a formal plan to dispose of the business component, and the sale qualifies for discontinued operations treatment. Pertinent data on the operations of Demand TV are as follows: loss from operations from beginning of year to September 30, $1.9 million (net of tax of $700,000); loss from operations from September 30 to end of 2021, $700,000 (net of tax of $250,000); estimated loss on disposal of net assets to December 31, 2021 (net of tax of $50,000), $150,000. The year end is December 31. BluRay prepares financial statements in accordance with IFRS. Required: A. What is the net income/loss from discontinued operations reported in 2021? B. Prepare the discontinued operations section of the income statement for the year ended 2021. The income statement should begin with income from continuing operations. C. How would the discontinued operation be presented on the statement of financial position?

Question 3 BluRay Inc: decided to sell DemandTV Ltd., a subsidiary, on September 30, 2021. There is a formal plan to dispose of the business component, and the sale qualifies for discontinued operations treatment. Pertinent data on the operations of Demand TV are as follows: loss from operations from beginning of year to September 30, $1.9 million (net of tax of $700,000); loss from operations from September 30 to end of 2021, $700,000 (net of tax of $250,000); estimated loss on disposal of net assets to December 31, 2021 (net of tax of $50,000), $150,000. The year end is December 31. BluRay prepares financial statements in accordance with IFRS. Required: A. What is the net income/loss from discontinued operations reported in 2021? B. Prepare the discontinued operations section of the income statement for the year ended 2021. The income statement should begin with income from continuing operations. C. How would the discontinued operation be presented on the statement of financial position?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter5: The Income Statement And The Statement Of Cash Flows

Section: Chapter Questions

Problem 2P

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WOODBRICKS CORP. decided on September 1, 2021 to dispose of a component of business. The component was sold on October 31, 2021. The net income of WOODBRICKS CORP. for the year 2021 included income of P8,000,000 from operating the discontinued segment from January 1 to the date of disposal. The entity incurred a loss of P3,000,000 on the October 31 sale of the business component. What amount should be reported as pretax income or loss from discontinued operations for 2021?
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2.On Feb, 1, Johnson Co. agreed to sell the assets of its Formal Wear Division to Sun Hat Inc. The following additional facts pertain to the transaction: The Formal Wear Division qualifies as a component of the entity according to GAAP regarding discontinued operations. The book value of Formal Wear's assets totaled $48 million on December 31, 2021. Formal Wear's operating income was a pre-tax loss of $10 million in 2021. Tango's income tax rate is 25%. Suppose that the Formal Wear Division's assets had not been sold by December 31, 2021, but were considered held for sale. Assume that the fair value of these assets was $40 million at December 31, 2021. In the income statement for the year ended December 31, 2021, Tango Co. would report discontinued operations of: A) $7.5 million loss. B) $10.0 million loss. C) $18 million loss. D) $13.5 million loss. .
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am. 105.
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