Final answer:
The lower portion of the 2021 income statement for Revolutionary Industries reveals that after income taxes and the gain on the sale of their robotics segment, the net income is $10.5 million.
Step-by-step explanation:
Income Statement Preparation
Below is a portion of the 2021 income statement for Revolutionary Industries, starting from income from continuing operations before income taxes:
Income from Continuing Operations Before Income Taxes $12,000,000
Income Tax Expense (25% of $12 million) ($3,000,000)
Income from Continuing Operations $9,000,000
Gain on Sale of Robotics Business Segment (Operation segment disqualied per GAAP)
Sales Price $9,000,000
Less: Book Value of Assets ($7,000,000)
Gain on Sale of Segment $2,000,000
Income Tax Associated with Gain on Sale (25% of $2 million) ($500,000)
Net Gain on Sale of Robotics Segment $1,500,000
Net Income $10,500,000
The calculation shows that after accounting for the income tax expense related to continuing operations and the gain on the sale of the robotics segment, the net income for Revolutionary Industries is $10.5 million.