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2 January, 09:39

The following information was extracted from the 2020 financial statements of Max Company: Income from continuing operations before income tax $705,000 Selling and administrative expenses 480,000 Income from continuing operations 495,000 Gross profit 1,350,000 The amount reported for other expenses and losses is

a. $210,000

b. $15,000.

c. $165,000.

d. $225,000.

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  1. 2 January, 09:55
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    c. $165,000.

    Explanation:

    Gross profit $1,350,000

    Selling and administrative expenses $480,000

    Income from continuing operations before income tax $705,000

    Income from continuing operations 495,000

    Total Expenses = Gross Profit - Income from continuing operations before income tax

    Total Expenses = $1,350,000 - $705,000 = $645,000

    Other Expenses = Total Expenses - Selling and administrative expenses

    Other Expenses = $645,00 - $480,000 = $165,000
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