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25 August, 14:56

On June 30, Cheyenne Corp. discontinued its operations in Mexico. On September 1, Cheyenne disposed of the Mexico facility at a pretax loss of $625,000. The applicable tax rate is 28%. Show the discontinued operations section of Cheyenne's statement of comprehensive income.

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  1. 25 August, 15:57
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    net loss is : 450,000

    tax = 625,000 * 28% = 175,000

    Explanation:

    discontinued operation: in this case, gain or loss always be shown net of taxes in the income statement

    total loss = 625,000

    net taxes = 175,000

    net loss = 625,000-175,000 = 450,000
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