Question

he following items appeared on the Year 6 year-end trial balance for the Brown Coffee Company:DebitsCreditsRevenues$600,000Operating expenses420,000Gain from disposal of component200,000Restructuring costs100,000Interest expense20,000Unrealized gain on AFS Debt Investment10,000Gain on sale of operating assets30,000Income tax expense has not yet been accrued. The company's income tax rate is 20% on all items. What amount should be reported in the company's year Year 6 income statement as income from continuing operations

Answer 1

net income $72,000

Step-by-step explanation:

The computation of the amount that should be reported is shown below:

Revenue $600,000

less:

operating expense -$420,000

restructing costs -$100,000

interest expense -$20,000

Add: gain on sale of investments $30,000

EBIT $90,000

less income tax at 20% - $18,000

net income $72,000