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Basic Accounting Concept 3 Questions Answers

The document contains a quiz related to basic accounting concepts, specifically focusing on income statements and calculations of net income. It includes various scenarios with calculations for income from continuing operations, income tax expenses, and losses from discontinued operations. The answers provided demonstrate the application of tax rates and net income determination based on given financial figures.

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14 views13 pages

Basic Accounting Concept 3 Questions Answers

The document contains a quiz related to basic accounting concepts, specifically focusing on income statements and calculations of net income. It includes various scenarios with calculations for income from continuing operations, income tax expenses, and losses from discontinued operations. The answers provided demonstrate the application of tax rates and net income determination based on given financial figures.

Uploaded by

j3172711
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Basic Accounting

Concept
Income Statement
Quiz

Week 4
• Answer: A
• 75% (i.e., 1 – tax rate) × $10 million operating loss =
$7.5 million pretax loss).
• Answer: B

Income from continuing operations before income taxes $ 300,000

Income tax expense 75,000

Income from continuing operations $ 225,000

Loss on discontinued operations (net of $20,000 tax benefit) (60,000)

Net income $ 165,000


• Answer: A
Income from continuing operations before income taxes $ 280,000
Income tax expense ($280,000 × 25%) 70,000
Income from continuing operations $ 210,000

Income on discontinued operations (net of $15,000 tax expense) 45,000

Net income $ 255,000


• Answer: A

• ($600 − $260 − $20) × (1 − 0.25) = $240


• Answer: B

Income from continuing operations before taxes ($600 − $260 − $20) $ 320

Income tax expense ($320 × 25%) 80


Income from continuing operations $ 240
Loss on discontinued operations (net of $10 tax benefit) (30)
Net income $ 210
• Answer: C

• $6,200,000 − $3,800,000 − $1,300,000 − $200,000 −


$80,000 = $820,000

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